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Employers with higher loss totals may pay even more for their workers compensation coverage starting January 1, 2013. The National Council on Compensation Insurance (NCCI), which helps at least 34 states and the District of Columbia* set their workers comp rates, has changed its methodologies for calculating an employer’s experience modifier (e-mod). The e-mod is a multiplier applied to the premium of a policy that can provide an incentive for loss prevention.
The e-mod is either a credit or debit that is applied to the premium. If your company experiences more worker compensation losses that are more costly on average than other companies in your industry, the result is a debit, or surcharge, on premiums. If your company has fewer and less costly claims than the industry average, you will receive a credit, or discount, on your premium.
Because the e-mod is just one factor used in determining a final worker compensation premium, a small change in an e-mod will not necessarily result in a premium increase. However, because of this change, thousands of employers can expect potentially significant increases in their workers compensations premiums.
Policyholders with proven risk management practices and safety programs that reduce workplace injuries will benefit from the change. The biggest negative impact will be on pricing for employers experiencing high-frequency, low-severity workers comp claims. Those are the types of injuries that are most likely to be controlled by employers through in-house safety programs.
A newly installed safety program may not forestall a rate increase in 2013 as risk is based on historical data. However, a health and safety management program could reduce your overall organizational risk profile and provide your insurer with other reasons to hold the line on premium increases.
An occupational health and safety management system (OHSMS) provides a framework for identifying and controlling health and safety risks and reducing the potential for accidents. It may also aid compliance and improve overall organizational performance.
A third-party certified OHSMS conforming to an international standard such as OHSAS 18001 provides indisputable evidence of your organization’s commitment to health and safety. NSF International Strategic Registrations (NSF-ISR) can handle your third-party certification to OHSAS 18001.
With a full range of solutions including baseline audits, document conformance review and combined audits, NSF-ISR can seamlessly integrate your OHSAS system with other compatible systems including ISO 9001 and ISO 14001. Choosing an integrated management system provides excellent value.
Let NSF-ISR help you streamline your systems, protect the health and safety of your employees and potentially hold the line on worker compensation premiums. To find out more, contact +1-734-827-6800, e-mail questions to information@nsf-isr.org or check out our web site at www.nsf-isr.org.
* States impacted by NCCI changes: Alabama, Alaska, Arizona, Arkansas, Colorado, Connecticut, District of Columbia, Florida, Georgia, Hawaii, Idaho, Illinois, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Mexico, Oklahoma, Oregon, Rhode Island, South Carolina, South Dakota, Tennessee, Utah, Vermont, Virginia and West Virginia.