An experience modification rate helps determine your workers comp premium. You should know more about this factor to help you choose the best provider for your company. Here’s everything you need to know about a workers comp ex mod.
What’s Workers Comp Ex Mod?
Insurers use ex mods to determine the relationship between past injuries and future risks. In its most basic form, the actual losses are divided by the expected losses, and higher risks mean higher costs.
How Does the Rating Work?
The data to determine the ex mod rating comes from the insured company’s history, generally after the start date. However, if a company has just started working with a new insurance company, the data will come from a set period before coverage begins. Generally, this data will be collected starting four years nine months and ending one year nine months before coverage begins.
What Happened To Manual Ratings?
Everyone still receives a manual rating. With this system, insurers group like companies and determine an average loss rating and policy cost. While this is more straightforward, you can save money with an ex mod because it is customized to your situation.
Ex mods are a crucial part of determining a policy premium regarding workers comp. To understand what affects your workers comp, you must know more about ex mods. Remembering this information will help you choose the best policy for your business.