Workers Comp Claims Data and Payroll
Workers Comp claims data and payroll must be important. I have received many inquiries about what changes are upcoming on 10/1/09 for E-Mod/X-Mod calculations. There are changes coming and they are not minor. Believe me, they cannot be ignored unless your company has limitless funds. Your Experience Modification Sheets whether promulgated by the NCCI, WCIRB, or a State Rating Bureau are going to be even more confusing than they are now. I have examined sample ones and my head started to spin.
Accurate claims data including reserves used to be just as important as payroll, but not as important as Workers Compensation Classification Codes. The claims data including reserves may now be the most important thing to your bottom line and could exceed Class Codes as being the most important set of data for your Workers Comp premiums. The fact is that no one knows how it will affect any company’s premiums as the new rules are not yet in place. If this does not scare you, then just open up the checkbook and use your best pen to write a big check.
Believe me, I am not saying that the new rules will discriminate against any one company or group of companies. That is just not true. Companies with inaccurate claims data and reserving are now going to feel the financial effects very rapidly. Your Workers Comp loss runs are now golden to you. If your company ignores them, please see the last sentence in the previous paragraph.
The new E-Mod/X-Mod calculations are going to make the unsafe companies take on more of a burden and pay a larger share. There used to be two variables that mattered – the number of claims and their severity. Now there are going to be more than 10 data inputs that are going make your E-Mod/X-Mod more specific to your company.
I wish that I could go more into the analysis. No one has seen a live version applied to a real company yet. Simulations are not real world examples.
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