Insurance & Premium Management
How the Experience Modification Factor Affects Workers' Comp Costs
Understand the mod well enough to explain it and change it
Playbook content
Introduction
- PDFPlaybook outlineDownload · PDF
- Key to Mod Formula Is Relationship of NumbersVideo · 3:59
Section 1
- Foundational Definitions and ConceptsVideo · 43:41
- Protocol check 1Pass at 70%
Section 2
- Frequency vs SeverityVideo · 11:43
- Protocol check 2Pass at 70%
Section 3
- The Mod Formula & Relationship of the NumbersVideo · 5:44
- Protocol check 3Pass at 70%
About this playbook
The experience mod is a carrier's snapshot of your risk. In guaranteed cost programs it is a primary driver of premium, and for high deductible and self insured employers it is a simple benchmark for program insight. This playbook covers the core definitions, frequency versus severity, and the relationship of the numbers inside the mod formula, so you can explain it plainly to senior management.
You will be able to
- Explain the mod formula in plain language to senior management
- Compare the weight of frequency and severity in your mod
- Show how changes in claim outcomes move premium
- Calculate your minimum possible experience mod
- Measure the impact of one claim on your experience rating