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D Ratio On My Experience Rating Sheets – What Is It?


Term Of The Day – D Ratio

A D Ratio is a variable used in a workers compensation experience rating plan. It is applied to the expected losses to determine what percentage of those expected losses are to be considered as primary losses within the rating formula.

Once discovered, the D-Ratio is the ratio of primary expected losses to the total expected losses for any certain classification code. It is then used on a workers compensation experience modification factor (emod) worksheet.

Table of of Expected Loss Rates D Ratio Experience Rating Plan
(c) wcirb.com

The D-Ratio is important because the experience rating formula splits injury cost between a primary amount and the remainder. Because primary losses are given more weight in determining the experience rating modification than are excess losses,it is an important factor to determine.

One can think of the Excess Losses as the discounted losses beyond a split point.  A split point

D-Ratios are produced by a rating bureau and published in that bureau’s experience rating plan manual. Each one varies by state and classification code.

The ratio cannot necessarily be disputed as they are attached to the associated Classification Code.  The ratio is calculated from a set of actuarial formulas used by each state rating bureau, WCIRB, or NCCI.

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James J Moore - Workers Comp Expert

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Management Consultants, Inc. in 1996. J&L’s mission is to reduce our clients’ Workers Compensation premiums by using time-tested techniques. J&L’s claims, premium, reserve and Experience Mod reviews have saved employers over $9.8 million in earned premiums over the last three years. J&L has saved numerous companies from bankruptcy proceedings as a result of insurance overpayments.

James has over 27 years of experience in insurance claims, audit, and underwriting, specializing in Workers’ Compensation. He has supervised, and managed the administration of Workers’ Compensation claims, and underwriting in over 45 states. His professional experience includes being the Director of Risk Management for the North Carolina School Boards Association. He created a very successful Workers’ Compensation Injury Rehabilitation Unit for school personnel.

James’s educational background, which centered on computer technology, culminated in earning a Masters of Business Administration (MBA); an Associate in Claims designation (AIC); and an Associate in Risk Management designation (ARM). He is a Chartered Financial Consultant (ChFC) and a licensed financial advisor. The NC Department of Insurance has certified him as an insurance instructor. He also possesses a Bachelors’ Degree in Actuarial Science.

LexisNexis has twice recognized his blog as one of the Top 25 Blogs on Workers’ Compensation. J&L has been listed in AM Best’s Preferred Providers Directory for Insurance Experts – Workers Compensation for over eight years. He recently won the prestigious Baucom Shine Lifetime Achievement Award for his volunteer contributions to the area of risk management and safety. James was recently named as an instructor for the prestigious Insurance Academy.

James is on the Board of Directors and Treasurer of the North Carolina Mid-State Safety Council. He has published two manuals on Workers’ Compensation and three different claims processing manuals. He has also written and has been quoted in numerous articles on reducing Workers’ Compensation costs for public and private employers. James publishes a weekly newsletter with 7,000 readers.

He currently possess press credentials and am invited to various national Workers Compensation conferences as a reporter.

James’s articles or interviews on Workers’ Compensation have appeared in the following publications or websites:

  • Risk and Insurance Management Society (RIMS)
  • Entrepreneur Magazine
  • Bloomberg Business News
  • WorkCompCentral.com
  • Claims Magazine
  • Risk & Insurance Magazine
  • Insurance Journal
  • Workers Compensation.com
  • LinkedIn, Twitter, Facebook and other social media sites
  • Various trade publications


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