Workers' compensation insurance is a large expense for employers. That makes it important to get the best workers' compensation coverage by shopping for the best insurance carrier, taking advantage of any safety improvement consultation offered by the insurance company, maintaining a low experience modification factor (X-MOD), and by working to ensure that workers' comp claims are closed as quickly as possible.
To get the best insurance company for your workers' compensation coverage, there are a few considerations. The first is price. For some businesses, shopping for the lowest premium for their workers' compensation coverage would be the deciding factor. Another important aspect of workers' compensation coverage to consider, however, is the financial strength of the insurance company and whether it will be around to pay claims if employees suffer serious injuries.
A third deciding factor is what additional services an insurance carrier will provide in addition to the workers' compensation coverage. Insurance companies that specialize in selling workers' comp insurance often have injury prevention experts on staff. These professionals consult with employers to help them to design a workplace where fewer employees are injured. If workers are injured on the job, insurance companies also have experts on staff to handle claims.
Employers can help themselves in getting the best workers' compensation coverage by making their workplaces safer, with or without the help of their insurance companies. This is because one of the biggest factors in how workers comp insurance is priced is a company's history of worker injuries. Every employer receives what is called an experience modification factor. The X-MOD is a formula that takes into account the number of workers' compensation claims employees have made each year and how many workers are on payroll. A good X-MOD can mean thousands of dollars in premiums saved.
Workplace safety is important in lowering the number of injuries at work and eventually lowering the X-MOD, but it is not the only factor that can lower the X-MOD. Another step for employers is to make sure that workers' comp claims are closed as soon as possible. This is another thing that affects the X-MOD, so when employers focuses on decreasing the time it takes, they help to improve the price of their workers' compensation coverage.
