Top 10 Questions #9
9. I had a great year with Workers Comp accidents this last year. Why did my E-Mod go up? That does not make sense.
We receive most of our most upset emails and calls on this question, except for Question #1 that was previously posted.
Your E-Mod will never reflect the policy year that you just finished. The insurance system in just not built that way. Let's say that you finished your policy year on 1/1/08. Your Experience Mod will be figured from January 1, 2004 through December 31, 2006, which is three years of time.
If you had a great year with little or no accidents in 2007, there is still a very positive effect. The 2007 policy year will affect your 2009, 2010, and 2011 E-Mods. If you have a great year this year in 2008, there is an additive effect, and the 2007 and 2008 policy years will show up in your 2010 and 2011 E-Mods.
The Total Incurred (see my many previous posts) is calculated for the for the 2009 E-Mod on 7/1/08, which lags six months behind the policy years. This timing allows the Workers Comp insurance company to have enough time to set the proper reserves on the newest claims. Once again, I agree with you that this is odd, but that is the Workers Comp insurance structure that is now in place in most states.
We receive most of our most upset emails and calls on this question, except for Question #1 that was previously posted.
Your E-Mod will never reflect the policy year that you just finished. The insurance system in just not built that way. Let's say that you finished your policy year on 1/1/08. Your Experience Mod will be figured from January 1, 2004 through December 31, 2006, which is three years of time.
If you had a great year with little or no accidents in 2007, there is still a very positive effect. The 2007 policy year will affect your 2009, 2010, and 2011 E-Mods. If you have a great year this year in 2008, there is an additive effect, and the 2007 and 2008 policy years will show up in your 2010 and 2011 E-Mods.
The Total Incurred (see my many previous posts) is calculated for the for the 2009 E-Mod on 7/1/08, which lags six months behind the policy years. This timing allows the Workers Comp insurance company to have enough time to set the proper reserves on the newest claims. Once again, I agree with you that this is odd, but that is the Workers Comp insurance structure that is now in place in most states.
Labels: The Top 10 Questions That We Receive on Workers Comp - 9
posted by James J Moore at 7:26 PM
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