One factor that strongly impacts your business and your NY workers comp rates is the experience modification rate or ex-mod. Insurance companies use the ex-mod factor to evaluate past injury losses and the chance of future ones.
When it comes to workers compensation rates, your company’s experience mod directly affects your costs. The lower the ex mod rate, the lower your workers comp premiums.
Understanding NY Workers Comp Rates Relationship to the Ex Mod
The industry average for exmod rates is 1.0 or 100%. A business factor more than 100% indicates a few things. First, that your company has experienced workers comp claims that your insurance carrier has paid on your behalf, and second, that in order to mitigate the claims cost, your workers comp insurer has raised your rates by more than the standard for your particular industry.
Policy claims affect your business ex mod rating for 3 years. Because losses count against your business for so long, it is vital that you take proactive steps to control your workers comp costs.
The good news is that prevention can help to keep your exmod low. And, the first step you should take as a business owner is to develop a well-written safety program and then implement its protocols within your companies. An effective safety plan that is thoroughly communicated to employees and developed into step-by-step procedures will help you to eliminate any workplace hazards and prevent injuries before they occur.
Obviously, zero injuries will result in zero additional costs to your workers comp policy. Of course, in the real world, you will have on-the-job injuries, but how you handle those claims will have a direct impact on how they affect your exmod and rates.
Make sure to include procedures for how to manage injuries within your company safety program, and hold regular safety training so that your employees fully understand your policies and procedures with regard to safety and injuries.