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Consolidation of multi-state payrolls saves company $283,000 and lowers Experience Mod

The company grows and distributes plant materials and nursery stock nationwide and employs more than 1,800 at plants located in 10 states.

The company’s Experience Modification Factor climbed steadily and management did not understand why this was occurring.

Certified WorkComp Advisors (CWCAs) discovered that the Mod was distorted because the only data factored in was the New York payroll information, which accounted for more than half of the overall payroll for the entire company. The combined NCCI data from the other 10 states was not being recorded. Thus, the New York Mod was not benefiting from the lower Experience Mod from the other states. The CWCA’s researched the situation and found that the company had different Mods in each state. The company was having a NY only Mod issued by the NYS Rating Board. It wasn’t taking advantage of the ability to combine many of the other states they operate in to produce a combined NCCI modification. The NY operation was being charged an inflated modification because the payroll and favorable loss experience from the other locations was not factored in the NY only mod.

The CWCA’s were in place as the agency for the company’s New York location. With the approval of the client, they began to collect all data related to the other locations, which was a challenge due to the fact that each location placed its own WC policy. Utilizing training they received from the Institute of WorkComp Professionals, the CWCA’s put all the information into a spreadsheet and then presented the data to management. This resulted in receiving the Broker of Record Letter to begin working on the other policies.

As a result of the work by the CWCA’s, the company’s Experience Mod dropped a total of 113 mod points over 4 years, netting the company a savings of $283,000.