E-Mod X-Mod Reduction Is A Very Popular Question
How do we reduce our E-Mod today or something along those lines is usually the question. There is no method for E-Mod (X-Mod) reduction that will show results immediately. The system is set up as a trend analysis of sorts.
The look-back or Experience Period is usually your 4th, 3rd, and 2nd policies in the past. There are many exceptions to that general rule.
There are so many articles on this blog concerning E-Mod X-Mod reduction that it would be easier to refer back those articles instead of reiterating them again.
The easiest way to find the articles on your own with a slant more towards your individual type of business or organization is by using the search box on the right side of the page. In fact, you can search the 1625 article blog for other subjects in addition to E-Mods. Feel free to print them for future reference.
One of the best ways for E-Mod (X-Mod) reduction is to have a safety program in place. This is not the one that looks good on paper, but actually a functioning loss prevention program. Keeping your workers out of the Workers Comp system by never having accidents is the best way to reduce your E-Mod.
Your E-Mod can be thought of as the credit score from hell. Your personal credit score can be changed instantaneously by correcting your credit risk. However, your E-Mod may take up to four years to fully reflect your safety efforts.
Patience is a virtue in this area. At least once your safety/loss prevention program shows improvement, the great results can be ongoing even if your company happens to have one accident.
The same methods can be used for self-insured with a twist. Your E-Mod is actually referred to as a LDF (Loss Development Factor). The LDF takes into account a ten years span using an actuarial method to predict the long tail values of a claim. I will cover those next week. Until then, you may use the search box on the right side of the page and search for LDF.
Article provided by James J Moore, AIC, MBA, ChFC, ARM. All articles are original content. Check out the full website at www.cutcompcosts.com