Workers’ compensation premiums can be a significant expense for your business. Taking steps to ensure proper training, accident mitigation programs and safety procedures help keep your costs low.
X mod insurance rates can also reduce your monthly expenses if you manage your claims effectively.
What is an X Mod?
This term refers to an experience modification rating that determines your workers’ compensation premiums. The Workers’ Compensation Insurance Rating Bureau of California bases this rating on your claims history and adjusts your premium accordingly.
An X mod rating of 1.0 is average. Anything above 1.0 increases your monthly payments, but any value less discounts them. The formula that calculates your rating takes your actual losses plus your expected excess losses, then divides them by the expected losses.
How Can You Manage Your Rating?
Frequent and severe claims negatively affect your X mod insurance rating. Staying proactive keeps your rating low by:
- Addressing potential safety hazards
- Eliminating preventable accidents
- Maintaining adequate training
- Fixing any claims errors
Dealing with claims in a timely and efficient manner reduces your costs in various ways. Enlisting experienced insurance agents to investigate claims helps the process go smoothly, ensuring your expenses stay low.
Once you understand what affects your modification rating, you can address any concerns regarding workplace hazards or claims management to reduce your incident frequency and monthly premiums.