As a business owner or financial manager, it is important to identify and understand every cost associated with doing business. It is especially important to understand the workers compensation modification factor, or experience rating, for your business as it has significant impact on the cost of workers compensation insurance.
What is the purpose of experience rating?
Experience rating is designed to measure whether your company’s worker’s compensation losses (also known as experience) are better or worse than expected. If the experience is worse than expected, you are punished with a higher mod (ex: 1.25) and you pay more for your insurance….