That number tells you and your agent how many of these smaller claims have been put into this number. These are categorized by “NO” and a number. Smaller claims that total less than $2,000 will be listed in one lump sum. This is where your business’ claims are listed-beneath the Claims Data heading. (A “risk” is an individual entity or business.) Your paid premium is examined and compared to the losses that workers’ compensation has paid out against your insurance policy.įinally, a total of premiums paid or losses sustained within your state within a determined period of time are recorded. The risk’s history, coming from the company’s losses and payroll on a unit card. The loss record of the insured (your business) is also determined. It’s comparison of the premium, using your payroll and your losses that have been arrived at using a risk during an individual policy period. “Experience,” when explained by workers’ compensation, takes it a little further. The NCCI or your state’s compensation rating bureau arrives at this number by working from a three-year history of your business’ payroll and losses. Every business in every state, no matter who calculated their modifier, receives the worksheet that spells out the modifier and how it was calculated.
If your business is not in an NCCI state, then your experience modifier is determined by the workers’ compensation rating bureau in your state. The National Council on Compensation Insurance (NCCI) is the organization responsible for calculating your business’ experience modifier. If your experience modifier is higher than 1.0, you receive a debit-an increase on your premium. Ideally, your experience modifier should be equal to or less than 1.0-you’ll get a credit or a reduction on your premium. This is a number multiplied by your premium.
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