If you recently received your Experience Modification (Ex-Mod) worksheet and noticed your number increased, you’re not alone. Every year I speak with business owners who are surprised to learn their workers’ compensation costs are about to increase—even though they don’t feel like they’ve had many claims.

The truth is, your Ex-Mod is one of the biggest factors insurance companies look at when pricing your workers’ compensation policy. A higher Ex-Mod often means fewer carrier options, higher premiums, and more underwriting scrutiny.

The good news is that an increased Ex-Mod doesn’t always mean you’re stuck paying more. In many cases, there are opportunities to improve your position before your next renewal.

What Is an Experience Modification?

An Experience Modification, commonly called an Ex-Mod, compares your company’s workers’ compensation claims history to other businesses performing similar work.

A score of 1.00 represents the industry average.

• Below 1.00: Better-than-average claims performance.
• Above 1.00: Higher-than-average claims experience.
• Above 1.25: Many insurance companies begin viewing the account as a higher underwriting risk.

The higher your Ex-Mod, the more your workers’ compensation premium is likely to increase.

Why Did My Ex-Mod Increase?

Many employers assume a large injury is the only reason their Ex-Mod rises. While severe claims certainly matter, there are several other reasons your score may increase.

Open Claims with High Reserves

One of the most common issues we find is an older claim that remains open with significant reserves.

Even if very little has actually been paid, the insurance company may still have money reserved for future medical treatment or indemnity benefits. Those reserves are often included in your experience rating calculation.

We’ve reviewed countless loss runs where simply resolving or properly adjusting reserves made a meaningful difference before renewal.

Multiple Small Claims

Several smaller claims can have a greater impact than many business owners realize.

Frequent first-aid claims, strains, slips, and minor injuries may individually seem insignificant, but together they can substantially affect your Experience Modification.

This is especially true when preventable incidents occur repeatedly.

Payroll Reporting Changes

Your Ex-Mod calculation also considers payroll.

If your payroll increased significantly while claims remained the same, your Ex-Mod may improve. Conversely, if payroll decreased while claims stayed consistent, your Ex-Mod may increase because the claims represent a larger loss relative to your payroll.

Classification Errors

Incorrect class codes or payroll allocations can affect both your premium and your Experience Modification.

We’ve seen businesses paying more simply because payroll was assigned to the wrong classifications or because clerical employees weren’t separated correctly.

Can You Lower Your Ex-Mod?

Yes—but it usually requires taking action before renewal.

Some of the most effective steps include:

• Reviewing your current loss runs for open claims and excessive reserves.
• Confirming payroll has been reported correctly.
• Verifying your classification codes are accurate.
• Working with your claims adjuster to close claims that no longer need to remain open.
• Implementing stronger return-to-work and safety procedures.

The earlier these issues are identified, the more options you typically have before your renewal is marketed.

Don’t Wait Until Renewal

One mistake we see repeatedly is waiting until the renewal quote arrives before reviewing claims.

By that point, the Experience Modification has already been calculated, and there may be very little that can be changed.

Ideally, employers should review their Ex-Mod worksheet and current loss runs several months before renewal. That provides enough time to identify errors, discuss reserve reductions when appropriate, and prepare the account for the insurance marketplace.

How Goldbridge Insurance Can Help

At Goldbridge Insurance, we specialize in helping employers with elevated Experience Modification factors.

Before we approach insurance carriers, we review loss runs, identify potential underwriting concerns, evaluate claims activity, and look for opportunities that could improve your workers’ compensation program.

Even if your Ex-Mod has already increased, there may still be ways to improve your renewal options and reduce your long-term costs.

If your Experience Modification recently went up—or you’d simply like a second opinion—send us your current Ex-Mod worksheet and your most recent loss runs. We’ll review them and explain what we see, along with any opportunities that may exist before your next renewal.

Call (888) 590-2667 or email info@goldbridgeins.com.

Goldbridge Insurance Services · 15840 Ventura Blvd, Suite 203, Encino, CA 91436