The process behind calculating workers’ comp premiums can feel complex, opaque, and downright confusing at times. Let’s break down what makes up your premium.
In simple terms, your premium is based on your employees, your industry and your past experience. Learn more below.
The total amount of wages and salaries paid to your employees annually is one of the primary factors used to determine workers' compensation premiums, although it is not the only one.
Payroll is a primary factor because if an injury cause your employee to miss work, your workers’ comp insurer will be covering part of their pay.
In part, your premium is determined by a "classification code" assigned to your industry (e.g. painting, retail, etc.) by the NCCI. This code is based on the exposures to injury associated with your industry.
When an industry—like construction—experiences more worker injuries, the classification code can change and raise rates for all companies within that industry.
That's why we're committed to helping all policyholders keep their employees safe, as well as providing industry-specific safety programs to industries with historically higher injury rates.
An experience modifier (or "e-mod") is a numerical rating assigned to your policy, also by the NCCI, based on your company's accident history.
This number is used as a multiplier against the average premium rate of companies in your industry—in other words, a roofing business is compared only to other roofing businesses.
If your e-mod is lower than the industry average (which is calculated as 1.00), your premium will be, too.
If your e-mod is higher than average, your premium will reflect this. We can help you keep your e-mod (and premium) low through our many safety services and Return to Work™ consulting programs and resources. More on e-mods.
If you have 90 seconds, you can get a quote with our quick online application and start your policy in less than five minutes.
If you prefer a more personal touch, connect with one of our trusted agent partners in your area.
