{"id":371,"date":"2020-09-02T16:14:05","date_gmt":"2020-09-02T16:14:05","guid":{"rendered":"https:\/\/newsite.payrollmedics.com\/blog\/?p=371"},"modified":"2020-08-21T16:23:53","modified_gmt":"2020-08-21T16:23:53","slug":"the-story-your-the-ex-mod-reveals","status":"publish","type":"post","link":"https:\/\/www.payrollmedics.com\/blog\/the-story-your-the-ex-mod-reveals\/","title":{"rendered":"The Story Your The Ex-Mod Reveals"},"content":{"rendered":"
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For many employers, workers\u2019 compensation insurance is all about one number\u2014the premium quoted. Understandably, employers want to pay the lowest amount possible on this mandatory coverage. While some brokers try to compete on a low bid, those who do miss the chance to educate employers on how their mod affects their premium, and how lowering their mod through targeted improvements in safety, hiring, return to work and other areas will ultimately improve both their direct and indirect workers\u2019 compensation costs.<\/p>\n

There\u2019s much more to workers\u2019 compensation than price. An analysis of your mod can identify problem areas in your operations and ultimately lead to cost savings.\"\"<\/p>\n

What does your mod reveal?<\/h3>\n

While the mod itself is a single number, an analysis of how your payroll and loss data functions in the experience rating formula can provide valuable insight.<\/p>\n

Mod calculation varies by state but generally depends on these components:<\/p>\n

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  1. Actual losses from the three prior policy periods, not including the most recent policy period<\/li>\n
  2. Expected losses based on payroll and expected loss rates for the industry<\/li>\n
  3. The amount of each loss, i.e., its severity<\/li>\n
  4. Whether the loss is medical-only, without temporary or permanent disability<\/li>\n
  5. Ballast and weighting values published by the National Council on Compensation Insurance (NCCI)<\/li>\n<\/ol>\n

    Generally, the mod is calculated using loss and payroll data from a three-year experience rating period. For example, for a mod factor calculated on Jan. 1, 2015, data would be used for the Jan. 1, 2011-2012, Jan. 1, 2012-2013 and Jan. 1, 2013-2014 policy periods. The data for the previous year (in this case, Jan. 1, 2014-2015) would be excluded.<\/p>\n

    Most employers realize their mod affects premiums in some way, but they rarely connect the dots and realize what actions they can take to lower their mod and insurance costs. That\u2019s where we come in. We can introduce cost-cutting concepts you may have never heard before and put workers\u2019 compensation insurance in a new light.<\/p>\n<\/div>\n

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    Mod Analysis = Cost Savings<\/h3>\n

    The mod is complex, but when you are able to use analytics to show what effect the mod has on your business, you will gain an edge over your competitors and ultimately save a lot of money.<\/p>\n

    The analysis by shows how low your mod (and associated premium) can be. Your \u201closs-free\u201d mod\u2014what the mod would be if there were no losses at all\u2014is a number unique to your organization, an attainable goal and something you should be shooting for.<\/p>\n

    You may wonder what your competitors pay for workers\u2019 compensation coverage. To answer that question, look at the \u201cexpected\u201d losses portion on the mod worksheet. This column reflects the average losses for a company with a similar payroll. How do you stack up?<\/p>\n

    If you have many losses, even if they are minor, those losses will impact the mod more than if there were fewer severe losses. This problem often points to some sort of safety training or cultural issue that needs to be addressed. We\u2019ll show you your frequency ratio\u20141.0 or higher needs attention.<\/p>\n

    We\u2019ll also examine whether you have a severity issue, or a problem with not keeping losses medical-only. This almost always points to an opportunity for cost savings and often the need to establish or improve a return to work program. Losing manpower from injuries on the job directly affects your business\u2019 earning power and bottom line.<\/p>\n

    Mod analysis will reveal problem areas, but fear not. Outlining a clear strategy to help lower the most costly losses or target problem areas, whether they\u2019re associated with a certain type of injury, body part, company location or other data.<\/p>\n

    What if you were to reduce your losses by 25 percent? Fifty percent? Even more? a mod analysis will show you real long-term savings and exactly how you can attain them.<\/p>\n<\/div>\n

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    The mod\u00a0 tells your story<\/h3>\n

    With the help of analysis, your mod tells a story\u2014about where your business has been and what it can do to improve. With the power of our leading software tools, we\u2019ll analyze your mod and tell your story. Specifically, a mod analysis can do the following:<\/p>\n