Category Archives: Managing Your MOD

Uncovering Loss Cost Multipliers

I’d written previously about knowing your carriers LCM and why that’s important to you.  If you don’t know what it is, start HERE

If you’re ready for step two, I’m sharing links to the various states LCM’s.  These aren’t always easy to find and some states deliberately don’t publish them.  In some instances, the link will go directly to a list, others will involve another step or two to complete the search.

Note, even if the list is dated as you’ll see in some jurisdictions, even if the filed LCM has changed slightly, it’s most likely the order of the pricing tier remains accurate.  For example, if a carrier has 5 pricing tiers in a state and you’re in the highest, even if the LCM has changed slightly, it’s still most likely that carriers highest rated pricing tier.

Continue reading Uncovering Loss Cost Multipliers

when do i actually qualify for an experience modification rating?

A. Premium Eligibility

1. Premium

a. Subject Premium

(Additional Rules: FLTX)

A risk’s eligibility for this Plan is based on the amount of subject premium as defined in Rule 1-C-7. Refer to Rule 2-A-2 and the State Table of Subject Premium Eligibility Amounts to determine premium eligibility for a specific risk.

b. Not Subject to Experience Rating

According to the Statistical Plan, some premium elements are not subject to experience rating. Premium may be charged for these elements under the standard policy. This premium is not:

   •    Subject to increase or decrease by an experience rating modification factor •    Used to determine premium eligibility for experience rating as detailed in Rule 2-A-2 •    Used in the calculation of an experience rating modification, unless otherwise stated in this Plan or the Basic Manual

2. State Subject Premium Eligibility Amounts

(Exceptions: MA, TX)

(Additional Rules: OR)

A risk qualifies for experience rating when its subject premium, developed in its experience period, meets or exceeds the minimum eligibility amount shown in the State Table of Subject Premium Eligibility Amounts in Rule 2-A-2-c. Refer to Rule 2-E-1 to determine a risk’s experience period.

   a.    A risk qualifies for experience rating if its data within the most recent 24 months of the experience period develops a subject premium of at least the amount shown in Column A. b.    A risk may not qualify according to Rule 2-A-2-a. If it has more than the amount of experience referenced in Rule 2-A-2-a, then to qualify for experience rating the risk must develop an average annual subject premium of at least the amount shown in Column B. Refer to Rule 2-A-3 to determine average annual subject premium. c.    A risk’s rating effective date determines the applicable Column A and Column B subject premium eligibility amounts required to qualify for experience rating. Refer to Rule 2-B for rating effective date determination.   State Table of Subject Premium Eligibility Amounts State Rating Effective Date Column A ($) Column B ($) AK 7/1/22 and after 5,500 2,750 7/1/21–6/30/22 5,500 2,750 7/1/20–6/30/21 5,500 2,750 AL 9/1/22 and after 11,500 5,750 9/1/21–8/31/22 11,000 5,500 9/1/20–8/31/21 11,000 5,500 AR 1/1/22 and after 9,000 4,500 1/1/21–12/31/21 9,000 4,500 1/1/20–12/31/20 8,500 4,250 AZ 7/1/22 and after 7,000 3,500 7/1/21–6/30/22 7,000 3,500 7/1/20–6/30/21 6,500 3,250 CO 7/1/22 and after 10,000 5,000 7/1/21–6/30/22 9,500 4,750 7/1/20–6/30/21 9,000 4,500 CT 7/1/22 and after 12,500 6,250 7/1/21–6/30/22 12,000 6,000 7/1/20–6/30/21 11,500 5,750 DC 5/1/22 and after 8,500 4,250 5/1/21–4/30/22 8,000 4,000 5/1/20–4/30/21 8,000 4,000 FL 7/1/22 and after 12,000 6,000 7/1/21–6/30/22 11,500 5,750 7/1/19–6/30/21 11,000 5,500 GA 9/1/22 and after 12,000 6,000 9/1/21–8/31/22 11,500 5,750 9/1/20–8/31/21 11,000 5,500 HI 7/1/22 and after 6,000 3,000 7/1/21–6/30/22 6,000 3,000 7/1/20–6/30/21 5,500 2,750 IA 7/1/22 and after 9,000 4,500 7/1/21–6/30/22 8,500 4,250 7/1/20–6/30/21 8,500 4,250 ID 7/1/22 and after 7,000 3,500 7/1/21–6/30/22 7,000 3,500 7/1/20–6/30/21 7,000 3,500 IL 7/1/22 and after 12,000 6,000 7/1/21–6/30/22 11,500 5,750 7/1/20–6/30/21 11,000 5,500 IN 7/1/22 and after 6,000 3,000 7/1/21–6/30/22 5,500 2,750 7/1/20–6/30/21 5,500 2,750 KS 7/1/22 and after 9,000 4,500 7/1/21–6/30/22 8,500 4,250 7/1/20–6/30/21 8,500 4,250 KY 7/1/22 and after 12,000 6,000 7/1/21–6/30/22 11,500 5,750 4/1/20–6/30/21 11,000 5,500 LA 11/1/22 and after 11,000 5,500 11/1/21–10/31/22 11,000 5,500 11/1/20–10/31/21 10,500 5,250 MD 7/1/22 and after 11,500 5,750 7/1/21–6/30/22 11,500 5,750 7/1/20–6/30/21 11,000 5,500 ME 10/1/22 and after 11,000 5,500 10/1/21–9/30/22 10,500 5,250 10/1/20–9/30/21 10,000 5,000 MO 7/1/22 and after 8,500 4,250 7/1/21–6/30/22 8,000 4,000 7/1/20–6/30/21 7,500 3,750 MS 9/1/22 and after 10,000 5,000 9/1/21–8/31/22 10,000 5,000 9/1/20–8/31/21 9,500 4,750 MT 1/1/22 and after 10,000 5,000 1/1/21–12/31/21 10,000 5,000 1/1/20–12/31/20 10,000 5,000 NC 4/1/22 and after 12,000 6,000 4/1/21–3/31/22 11,500 5,750 4/1/19–3/31/21 11,000 5,500 NE 8/1/22 and after 7,000 3,500 8/1/21–7/31/22 7,000 3,500 8/1/20–7/31/21 7,000 3,500 NH 7/1/22 and after 13,500 6,750 7/1/21–6/30/22 13,000 6,500 7/1/20–6/30/21 12,500 6,250 NM 7/1/22 and after 10,500 5,250 7/1/21–6/30/22 10,000 5,000 7/1/20–6/30/21 9,500 4,750 NV 9/1/22 and after 7,000 3,500 9/1/21–8/31/22 7,000 3,500 9/1/20–8/31/21 6,500 3,250 OK 7/1/22 and after 11,500 5,750 7/1/21–6/30/22 11,000 5,500 7/1/20–6/30/21 10,500 5,250 OR 7/1/22 and after 6,000 3,000 7/1/21–6/30/22 6,000 3,000 7/1/20–6/30/21 5,500 2,750 RI 2/1/22 and after 11,500 5,750 2/1/21–1/31/22 11,000 5,500 2/1/20–1/31/21 11,000 5,500 SC 8/1/22 and after 10,500 5,250 10/1/21–7/31/22 10,000 5,000 10/1/20–9/30/21 10,000 5,000 SD 1/1/22 and after 9,000 4,500 1/1/21–12/31/21 8,500 4,250 1/1/20–12/31/20 8,500 4,250 TN 9/1/22 and after 10,500 5,250 9/1/21–8/31/22 10,500 5,250 9/1/20–8/31/21 10,000 5,000 UT 7/1/22 and after 8,500 4,250 7/1/21–6/30/22 8,000 4,000 7/1/20–6/30/21 8,000 4,000 VA 10/1/22 and after 8,000 4,000 10/1/21–9/30/22 8,000 4,000 10/1/20–9/30/21 7,500 3,750 VT 10/1/22 and after 9,500 4,750 10/1/21–9/30/22 9,000 4,500 10/1/20–9/30/21 9,000 4,500 WV 5/1/22 and after 10,500 5,250 5/1/21–4/30/22 10,500 5,250 5/1/20–4/30/21 9,500 4,750

3. Average Annual Subject Premium

Determine a risk’s average subject premium on an annual basis for experience rating eligibility purposes as follows:

Total Subject Premiumx12=Average Annual Subject Premium
Total Months of Experience in Experience Period
(excluding gaps in coverage)

When the average annual subject premium is determined, refer to Column B in Rule 2-A-2 for premium eligibility requirements. The reference to total months of experience in this calculation includes partial months.

Start the clock… 3, 5, or 7 days before lost wage payments?

Check out this quick chart for answers on what the waiting period is in your state or province before lost wages kick in from workers’ compensation.

What is the retroactive period when an employee is able to recoup those first unpaid days?

How about who gets to direct care?

It varies by state.  The answers are here!

Continue reading Start the clock… 3, 5, or 7 days before lost wage payments?

Audits and your Liability Policy

A common topic of discussion is the workers’ comp audit.   Either through the horror stories of friends or self experience, you’ve heard the terrible tale of the large comp audit.   You’re now keenly tuned in to the payrolls and exposures on your work comp policy vowing never to let this happen to your organization again (or ever)!

Perhaps you’ve even transitioned to a “pay as you go” program to virtually eliminate the chance of an audit bill.

But… and there always seems to be a but.  What about your liability policy?  While you find yourself plugging the holes in one area, don’t forget the GL policy is often  an auditable policy like the WC.   Don’t make the mistake of assuming that since you’ve notified your carrier or broker of accurate payrolls for the workers’ compensation policy, those same updates translated to your liability policy!  You might be surprised to learn otherwise and we already know, that’s rarely a good thing.

Keep track of your liability policy exposures just as you do on the WC!

Comp rates continue to fall in Maryland and Nationally!

OK, some good news likely headed your way!  Many policy holders can expect some WC rate reduction again this year.

Here’s a notice just sent to Maryland brokers from Builders Mutual Insurance.

2018-01:  Maryland Workers’ Compensation Rate Changes

Effective March 1, 2018 and applicable to all new and renewal Workers’ Compensation policies, Builders Mutual Insurance Company is implementing NCCI’s January 1, 2018 revised loss costs for Maryland and revising the Company developed Loss Cost Multipliers. This change represents an overall rate decrease of 9.4% to our Builders Mutual book of business and a decrease of 9.5% to our Builders Premier book of business, however changes may vary by individual class.

In addition, maximum and minimum payroll amounts are:

Included officers minimum payroll – $54,600 per year (was $49,400)

Included officers maximum payroll – $218,400 per year (was $197,600)

Sole proprietor or partner (if elected coverage) – $54,700 per year (was $48,900)

 

Be on the lookout!

Have you ever noticed a scheduled credit on your policy?  Ever wonder why it’s there?

Often times brokers are able to negotiate these on  your behalf, but sometimes the scheduled credits are adjusted based on the experience MOD changes.

Picture this…

It’s 2017 and you’re at the last year of your debit experience MOD of a 1.25.  Your current WC policy for that year has a scheduled credit of .80, easing some of the pain of your current debit MOD rating.  Your renewal policy comes in for 2018 with a new MOD of .78 and low and behold your scheduled credit is now a scheduled debit of 1.10.  What gives?   Virtually all of the premium savings you were expecting is gone!

Continue reading Be on the lookout!

Insurance Definitions and Terms

I sound like a broken record on this, but you can’t manage what you don’t understand! Insurance terms and policies are far from commonplace for most of us.

For those of you that don’t live and breath insurance, here’s an in depth list of insurance terms and what they mean to you.

Continue reading Insurance Definitions and Terms

Big Changes with non-compliant Audits!

Ever thought of not complying with your work comp insurance audit? In years past failure to comply with an audit might have caused an estimated audit with exposures inflated by 50% and some carriers were forgiving enough to process non compliant audits with no additional payroll increases.  With the new changes you may want to reconsider unless you’re ready for a potential 200% increase in exposures!

Does your policy have the endorsement WC 00 04 24?

 

2016-14:  Audit Noncompliance Charge for WC Policies

NCCI has established an Audit Noncompliance Charge Endorsement (WC 00 04 24) that will be included on all new and renewal workers’ compensation policies effective January 1, 2017.  The endorsement enables an insurance carrier to apply an Audit Noncompliance Charge to a workers’ compensation policy if the policyholder does not comply with the annual premium audit of their records.  When attached to policies, the endorsement will include the estimated annual payroll (in the Basis of Audit Noncompliance Charge section) and the annual premium multiplier that may be applied for noncompliance (in the Maximum Audit Noncompliance Charge Multiplier section).