2019 California Experience Rating Changes

The first $250 of every claim is excluded – reporting the cost of minor workplace injuries helps everybody.

The Insurance Commissioner recently adopted changes to experience rating. These changes make it easier for employers to understand how reducing workplace injuries will reduce their premium cost and the importance or reporting all claims.

the new formula excludes the first $250 of each claim from the X Mod computation.  This change removes any experience rating  incentive to not report the cost of small or “first aid” type claims to your insurer.  The new simplified formula also places a clear and direct emphasis on reducing the occurrence and cost of workplace as reflected in the actual primary losses.

Under California’s experience rating plan only the amount of each of your claims, up to your primary threshold, is used in the xmod computation. With the $250 loss exclusion, that amount is reduced by $250. For example, if you have a $10,000 primary threshold and a single claim of $5,000, the amount used in the xmod computation is $4,750. If you have a single claim of $15,000 the amount used the xmod is your primary threshold ($10,000) less $250 or $9,750

Any claim incurred against policies incepting during the experience. For your 2019 experience modification which includes 2015, 2016 and 2017, will be used in the xmod computation that’s $250 less than its value reclaim will continue to be shown on the experience writing worksheet, but will not be used in any way in the X Mod calculation. https://cssinsuranceservices.com/2019/04/16/no-injury-declaration-useful-form-for-employers-to-protect-their-business/

About Daniel McKenna

Dan McKenna
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