How to Control Workers’ Comp Costs

MyTPG Blog
Published: 12/6/21 5:00 AM

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How to Control Workers’ Comp Costs

This article was published on: 12/6/21 5:00 AM




Workers’ compensation costs can make or break your bottom line. So, it is essential for your to control workers’ comp costs. This may seem out of reach or difficult to accomplish. However, control over these costs is more attainable than you might believe. To do so, you must understand your experience modification factor and its impact on your insurance premium.

Control Workers’ Comp CostsUse Your Mod Factor


The secret to managing your workers’ compensation costs is comprehending your experience modification factor, or mod factor. Your mod factor is an adjustment to your workers’ compensation premium. It’s based on your business’s actual losses compared to its expected losses based on the market you’re in.

The mod factor represents either a credit or a debit that is applied to your workers’ compensation premium. A mod factor greater than 1.0 is a debit mod. This implies that your losses are worse than expected and a surcharge will be contributed to your premium. A mod factor less than 1.0 is a credit mod. This means losses are much better than expected, leading to a reduced premium.

If your mod factor is over 1.0, show management how controlling costs can save you money on your insurance premium. To save money, you need it to fall below the 1.0 threshold.

Control Your Mod Factor


You may not know it; however, you do have control over your mod factor– and control over your workers’ compensation premium.

Your mod is calculated based upon data reported to the rating bureau by past insurers. Incorrect or incomplete data can cause inaccurate mod factors. Evaluate your loss and payroll information to ensure that your xmod info is complete and accurate.

You can likewise manage your mod factor by encouraging everyone to concentrate on safety– especially management and anyone else who is associated with managing costs. Everyone working safely means fewer accidents to report to your insurance carrier and a lower mod factor.

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Control Workers’ Comp Costs with a Return-to-Work Program

Another way to control your costs is to develop a return to work program and provide customized or light tasks to injured workers who can go back to work.

Choosing modified or light-duty jobs may appear troublesome, but this is an important way to minimize your workers’ compensation costs– you spend for fewer days far from work and you keep routine contact with employees, so you can see how their healing is advancing. The most successful return to work programs can accommodate nearly any restrictions.

Workplace Policies Help Control Costs, Too

Your workplace policies should motivate safe working habits and timely reporting of injuries and accidents. Numerous companies have accident reporting policies in place however do not bother to execute them, which is foolish since workers’ injuries could go unnoticed and worsen over time.

When you get a claim for an on-the-job accident or injury, report it to your workers’ compensation company as soon as possible.

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After an accident or injury, examine the incident immediately. Timely examination helps you protect evidence and can discourage employees from making fraudulent claims in the future.

If workers’ compensation costs are hurting you economically or if you wish to find out more about how your mod affects your premiums, contact your broker at TPG Insurance Services for the guides, resources, and policies you require to keep your costs in check; just call 909.466.7876. We’re here to assist you to secure your business and your bottom line. Also, check out our Workers’ Comp content to discover additional practical and reliable information!