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Business insurance
The experience modification factor, or mod, adjusts a business's workers' compensation premium up or down by comparing its actual claims history with the expected losses for similar businesses in its classifications. A mod of 1.00 is average; below 1.00 earns a credit and above 1.00 adds a debit.
Most states use a mod calculated by NCCI, while some states run their own rating bureaus. Claim frequency usually weighs more heavily than severity, so a run of small claims can hurt a mod more than one large one. Return-to-work programs and safety work can bring it down over time.
A workers' compensation premium calculator is built and awaiting release. Its useful inputs will be payroll by class code, the mod and any schedule credits, which together let a commercial producer judge whether a prospect's current premium looks out of line before requesting loss runs.
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