| Most employers believe that having a handful of | | | | these types of claims have on your Experience Mod |
| smaller injuries spread across the policy year will | | | | factor. |
| impact their EMR (Experience Mod) to a lesser | | | | Let's take a look at an example. A company with a |
| degree than by having an employee suffer one | | | | manual premium of $150,000 has a claim with a total |
| severe injury. This is hardly the case. | | | | incurred cost of $18,455 and three $6,155 claims. |
| Let me preface this article with a disclaimer that we | | | | Total Incurred Cost |
| are discussing the economics of workplace injuries, | | | | Impact on EMR What They Pay |
| and the effect that both types of claims can have | | | | Through an Increase in Premiums |
| on your bottom line. All too often, businesses focus | | | | $18,455 |
| all of their attention on the prevention or reduction | | | | .0491 |
| of severe injuries and let the smaller, more frequent | | | | $17,676 |
| injuries continue without a blink of an eye. | | | | $6,155 |
| Economically speaking, the result of such action can | | | | .0357 |
| cost a company dearly. | | | | $12,829 |
| An employee that has an injury that requires surgery | | | | $6,155 |
| or a battery of tests has costs associated with it | | | | .0357 |
| that can cause an employer to lose sleep. Of course | | | | $12,829 |
| you want to ensure that this type of injury doesn't | | | | $6,155 |
| occur again, but while you focus your attention on | | | | .0357 |
| this $18,000 claim, there are three other "small" claims | | | | $12,829 |
| that occur yet do not receive the same enthusiasm | | | | Shocking, isn't it? So why is this particular company |
| that larger claims receive. | | | | paying $20,811 more for the three small claims, than |
| What is the purpose of the majority of companies in | | | | the one claim that had a similiar total incurred cost? |
| the world? To create value and be profitable, right? | | | | The reason is because the workers' compensation |
| At face value, the reaction to focus more on the | | | | system was developed to protect both the |
| most expensive claim is logical. However, the smaller | | | | employee and the employer from severe or |
| claims need the same attention due to the impact | | | | catastrophic injuries that occur in the workplace. |