Not All Workers Comp Accidents Affect MOD Immediately
Did accidents affect MOD in my Workers Comp policy year? Is it true that what happened in my last Work Comp policy year will not affect the Experience Mod for my current policy year? I had a much better year with accidents in 2007 and a terrible one in 2003.
You are correct. The basic rule is that all Workers Comp policies that started from four years and nine months ago (57 months) up to 24 months ago will affect your Workers Compensation Experience rating.
Your Workers Comp policies have always started on 10/01. So, your upcoming Experience Rating for 10/01/08 – 10/01/09 will be based on all policies that started from 1/1/03 through 10/01/06.
Therefore, your policy for 10/01/08 will be affected by the policy years:
- 10/01/03 – 10/01/04
- 10/01/04 – 10/01/05
- 10/01/06 – 10/01/07
The NCCI has published revised rules on the months that the Experience Period covers. There are many intricacies to the Experience Rating Period. The revised rules make the Experience Rating Period ever more complicated.
The bad year you had will drop off on the 2009 – 2010 policy year.
Caveat To The Accidents Affect XMod Statement
The additive effect of Mods can be devastating to an employer’s Mod history if the claim remains open for each of three policy years and the file reserves keep increasing while still in the Experience Period. The claims reserves will hit the Mod three times wit the new figures the claim department set each time. (Ouch!) A reserve review remains the best way to make sure the claim reserves are in line with expectations.
A question we receive very often will be answered in the next posting that has to do with Experience Rating and Workers Comp reserves.
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