Turning the Tables: How to Lower Your Experience Mod and Save Money

If you're a business owner, you know how crucial it is to stay on top of your expenses.

A significant expense that many businesses face is workers' compensation insurance premiums. However, did you know there are ways to lower those premiums and save money?

One such method is reducing your experience modification (mod) factor, which we'll discuss in this article.

experience mod save money workers comp

Understanding Experience Modification Factors

Before we delve into how to lower your experience mod, let's ensure you understand what it is. Essentially, your experience mod is a numeric representation of your company's safety record compared to others in your industry.

Your business's workers' compensation claims data is compiled and analyzed each year. An experience rating is then calculated based on this data.

The rating considers your company's actual losses compared to expected losses for businesses of similar size in your industry.

The experience mod is expressed as a percentage. It is typically calculated by your state's workers' compensation regulatory agency or by the National Council on Compensation Insurance (NCCI), a third-party rating organization.

It's important to note that your experience mod can significantly impact your workers' compensation insurance premiums.

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What is an Experience Mod?

Your experience mod is a number that represents the ratio of your actual workers' compensation claims compared to the expected claims of similar businesses in your industry.

The experience mod is calculated annually based on your business's claims history over the past three years.

For example, if your business has more workers' compensation claims than similar businesses in your industry, your experience mod will be higher.

On the other hand, if your business has had fewer claims than expected, your experience mod will be lower.

How Experience Mods Affect Your Insurance Premiums

Your experience mod can significantly impact your workers' compensation insurance premiums.

A higher mod means a higher risk, and insurers will charge higher premiums to cover this increased risk.

A lower experience mod, on the other hand, can result in lower premiums.

For instance, if your experience mod is 1.0, your business has an average safety record compared to other businesses in your industry. If your experience mod is less than 1.0, your business has a better safety record than average, and you may be eligible for lower premiums.

If your experience mod exceeds 1.0, your business has a worse safety record than average, and you may be charged higher premiums.

READ NEXTWorkers Comp Experience Modification Rate: Everything You Need To Know

Factors that Influence Your Experience Mod

Several factors can influence your experience mod, including the number and severity of your workplace injuries or illnesses, the size and scope of your business, and your industry's overall safety record.

Other factors that can impact your experience mod include your company's safety policies and procedures, employee training, and the effectiveness of your return-to-work program.

By implementing effective safety measures and promoting a culture of safety in your workplace, you can help reduce the number of workplace injuries and illnesses, which can ultimately lower your experience mod.

The main thing to remember is that you have some control over your experience mod, and there are practical steps you can take to lower it.

By improving your safety record and reducing workplace injuries, you can save money on insurance premiums and create a safer and healthier workplace for your employees.

Strategies for Lowering Your Experience Mod

Keeping your employees safe should be a top priority as a business owner.

It is the right thing to do and can help you save money on your workers' compensation insurance premiums.

One way to do this is to lower your experience mod, which is a factor used to determine your insurance rates. Here are some strategies that can help you lower your experience mod.

Implementing a Strong Safety Program

A comprehensive safety program is one of the most effective ways to reduce your experience mod.

A program like this can help you identify and mitigate potential hazards and prevent workplace accidents.

A good safety program should include regular safety training for employees, identifying and analyzing potential hazards, and ongoing oversight and management of the safety plan.

For example, if you run a construction business, you might implement a safety program that includes regular safety meetings, personal protective equipment (PPE), and regular equipment inspections.

Doing so can help prevent accidents and keep your employees safe.

Focusing on Return-to-Work Programs

Another way to lower your experience mod is to focus on return-to-work (RTW) programs. RTW programs are designed to help injured employees return to work as soon as possible after an injury.

Getting employees back to work sooner can reduce lost productivity and the costs associated with temporary disability payments.

This strategy can also help you maintain good employee relationships and reduce the likelihood of lawsuits.

For example, if you run a restaurant and one of your employees suffers a burn injury, you might create a modified duty program that allows the employee to perform light-duty tasks until they are fully healed.

By doing so, you can keep the employee engaged and productive while also reducing the costs associated with their injury.

Regularly Reviewing and Updating Your Safety Policies

Your business is continually evolving, and your safety policies must evolve, too.

Reviewing and updating your policies can help you avoid potential risks and keep your employees safe.

Additionally, it can help lower your experience mod by demonstrating to insurers and regulatory agencies that you take employee safety seriously.

For example, if you run a manufacturing business, you might review your safety policies annually to ensure they are up-to-date with the latest safety regulations.

You might also conduct regular safety audits to identify potential hazards and make changes as needed.

Providing Employee Training and Education

Providing your employees with regular safety training and education can go a long way in reducing workplace accidents.

It's essential to keep your employees informed and aware of potential hazards on the job.

You can do this by holding regular safety meetings, providing safety training courses, and prioritizing safety in your workplace.

For example, if you run a landscaping business, you might provide your employees with training on how to operate equipment like lawnmowers and trimmers safely.

You might also hold regular safety meetings to discuss hazards like uneven terrain and poisonous plants.

In conclusion, lowering your experience mod requires a commitment to safety and a willingness to invest in your employees.

By implementing a strong safety program, focusing on return-to-work programs, regularly reviewing and updating your safety policies, and providing employee training and education, you can keep your employees safe and save money on your workers' compensation insurance premiums.

READ NEXT5 Reasons You Can’t Lower Your Experience Mod

Monitoring and Analyzing Your Claims Data

Reducing your experience mod is crucial for the success of your business. One of the ways to achieve this is by tracking and analyzing your claims data regularly.

This will help you identify patterns and trends and proactively reduce future claims.

However, analyzing your claims data goes beyond just looking at numbers.

It involves a comprehensive review of each claim's circumstances to identify the root causes of the injuries or accidents.

Identifying Trends and Patterns

By analyzing your claims data, you can identify patterns and trends in accidents and injuries. For example, you may notice that a particular department or shift has a higher frequency of accidents than others.

This information can help you take targeted action to reduce the risks associated with certain activities or conditions and implement measures to reduce future claims.

In addition, analyzing your claims data can help you identify the most common types of injuries and accidents.

Armed with this information, you can take proactive measures to prevent future incidents.

For instance, if you notice that most of your claims are related to slips, trips, and falls, you can implement safety measures such as anti-slip flooring, proper lighting, and regular cleaning schedules.

Addressing Root Causes of Workplace Injuries

Getting to the bottom of why workplace injuries occur is crucial to preventing future incidents.

By analyzing your claims data, you can identify the underlying causes of injuries and accidents, such as inadequate training, poor equipment maintenance, or lack of safety protocols.

Once you identify the root causes, you can take decisive action to address them. This may involve providing additional training to employees, upgrading equipment, or revising safety protocols.

Collaborating with Your Insurance Provider

Your insurance provider can be an invaluable resource in helping you reduce your experience mod.

Most insurers are vested in your success and will work with you to help reduce your accident frequency and severity.

Working with your insurance provider can involve various activities, such as safety assessments, training programs, and claims management.

By collaborating with your insurance provider, you can gain access to resources and expertise that can help you improve your safety performance and reduce your claims.

In conclusion, monitoring and analyzing your claims data is crucial to reducing your experience mod and improving your safety performance.

By identifying trends and patterns, addressing root causes, and collaborating with your insurance provider, you can take proactive measures to prevent future incidents and create a safer workplace for your employees.

READ NEXTExperience Modification Rate: Ways To Cut Costs On Workers Comp

The Benefits of Lowering Your Experience Mod

Reducing your experience mod comes with several benefits, including:

Reduced Insurance Premiums

Lowering your experience mod can lead to lower premiums and save your business significant money.

This can free up resources for other areas of your business, such as investing in new equipment or hiring additional staff.

Additionally, by demonstrating a commitment to workplace safety, you may be able to negotiate even lower premiums with your insurance provider.

Improved Workplace Safety

By reducing workplace injuries, you'll create a safer work environment for your employees, reducing employee turnover and increasing morale.

This can also increase productivity and efficiency, as employees are less likely to miss work due to injury or illness. Implementing safety measures such as regular training and equipment maintenance can help prevent accidents and injuries in the workplace.

Enhanced Employee Morale and Retention

Employees want to work in a safe environment, and reducing workplace injuries can increase employee satisfaction and retention rates.

Employees who feel valued and safe are more likely to stay with a company long-term, reducing turnover and associated costs. Additionally, a positive workplace culture that prioritizes safety can attract top talent and improve overall team morale.

A More Competitive Business Position

Lowering your experience mod can give you a competitive advantage, allowing you to bid on jobs and contracts more competitively than industry rivals.

This can open up new opportunities for your business and help you expand your customer base. By demonstrating a commitment to safety and risk management, you may also be able to secure contracts with larger companies that require a certain level of safety compliance.

Reducing your experience mod can benefit your business, from saving money on insurance premiums to improving workplace safety and employee morale.

You can create a more successful and competitive business by prioritizing safety and implementing effective risk management strategies.


As you can see, reducing your experience mod can significantly impact your business's bottom line.

Implementing a comprehensive safety program, focusing on RTW programs, regularly reviewing and updating safety policies, providing employee training and education, monitoring and analyzing your claims data, and collaborating with your insurance provider can all help lower your experience mod factor and save you money on premiums.

Taking decisive action and reducing workplace injuries create a safer workplace and save your business money in the long run.

If all this sounds overwhelming or confusing, or if your current insurance agent has never addressed these issues, I’d encourage you to contact us at Rogue Risk today.

I hope this article helped you better understand your Experience Mod.

Thank you,

Ryan Hanley

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