Did you know that your experience modification rate directly correlates to your company’s annual income? After projecting future ex-mod for your business, you will have insight on earnings (or losses) to come. Analytics are a huge boon for prudent business managers, but they need to know when it’s time to seek help. There is a critical warning sign that can signify that ex-mod is going south.
What Is Ex-Mod?
Experience modification (ex-mod) is a ratio that is based on the number of workers’ compensation claims made at your business. Sophisticated analysis of a company’s data history can be used to project future rates. With an idea of where you’ve been and where you’re going, you can bring an out-of-hand ex-mod back down to Earth.
Monitor Frequency of Claims
A high frequency of workers’ comp claims is more detrimental to ex-mod than the severity of those claims. If measures aren’t taken to promote safety in the workplace, insurance premiums will cut drastically into the business budget. It’s vital to incentivize a team to review safety guidelines and never cut corners.
Business owners who check on the frequency of workers’ compensation claims will stay aware of major threats to the company’s ex-mod. Being proactive is the best preventative measure. To that end, the next step after implementing new safety procedures is to try projecting future ex-mod to gauge how the business will benefit going forward.