Quality Insurance From G.A. Crandall & Co., Inc

Do you know how your experience modification factor affects your premium?

Following is a copy of a page from a proposal I did for an upscale restaurant in Illinois.  This illustrates the effect your experience modification factor has and can have on your premiums.

• Your 2009  Experience Modification Rating factor  is 1.12 
  
  
• Your experience includes two lost workday case claims valued at $46,328   
  
  
• Had these claims been medical only claims your 2009 EMR would be a .97
  
  
• The estimated difference in premium between a .97 and 1.12 EMR  is *$3,968 
  
  
• Claims remain in your history for a period of threes years making the potential cost of these claims $11,904 more than it would have cost if the employee could have returned to work in some capacity.
  
  
• Your lowest possible modification factor is .89.  The difference in premium between a 1.12 mod and a .89 is *$13,148
  
  
• We received 4 declinations from underwriters for your workers compensation coverage due to your loss history.  You are at risk of having to purchase your workers compensation coverage through the assigned risk plan in Illinois. Premiums in the assigned risk plan are promulgated using the assigned risk rate (currently 3.74), your current EMR, and ARAP mod.  Your 2009 ARAP mod is 1.25. Policies in the assigned risk plan do not receive any premium discount.
  
  
• Based on your current payroll your premium in the assigned risk plan for the 2009 renewal would be $56,938.  This would represent a $32,000 increase from the best offer we received this year.
  
  * Calculations are based on 0% schedule credit, payroll in your current history, loss history and a restaurant rate of $2.74 per hundred of payroll. The differences in premium could be greater or less depending on market conditions and an underwriter’s willingness to insure the risk.
   

Call me today if you would like to learn more about  managing your workers compensation experience modification factor.