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Interstate Rating Does Not Apply To All States – Some Are Independent


Term Of The Day – Interstate Rating

Interstate Rating is experience modification factors that apply across more than one state. They are administered and calculated by the NCCI for employers who have shown payroll for more than one state in the past.

Map Of USA Interstate Rating Graphic

Nearly every state in the country participates in the interstate rating system. There are exceptions to every rule because there are still some states who have chosen not to participate. These states are Pennsylvania, California, New Jersey, Michigan, and Delaware.

These states have their own independent rating bureaus and do not want to co-mingle their rating factors with other states.  These independent states may have such differing rating factors that NCCI could not use their calculations.   Attempting to figure out one Experience Modification Factor can be difficult when applying multiple Mod into one.

The classic employer types that have interstate ratings are:

  • Companies with multi-state operations
  • Trucking companies with multiple terminals
  • Larger national companies
  • Companies that have businesses near state lines

Modification factors for payroll for these 5 states are calculated by the state’s own rating bureau. Employers who have exposure in participating states and these nonparticipating states could possibly have 6 separate and different experience modification factors. The experience modification factor would only apply to the exposure in each stand-alone state.

After speaking with representatives from a few of the nonparticipating states, I came to the conclusion they were not amenable to ratings other than their own states.   Interstate ratings may become more popular in the future but not immediately for the five listed states.

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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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