International Door & Operator Industry

MAR-APR 2018

Garage door industry magazine for garage door dealers, garage door manufacturers, garage door distributors, garage door installers, loading docks, garage door operators and openers, gates, and tools for the door industry.

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Page 88 of 142

86 International Door & Operator Industryâ„¢ If you want additional information about the advantages of the IDA Insurance Program, please contact Andrew Stergiou at 212-603-0321 ( Alliant Insurance Services, Inc. the consulting broker for the IDA Insurance Program, is one of the largest and most experienced insurance and surety bond brokerage firms in the country. ASSOCIATIONNEWS well as both the frequency of losses and the severity of those losses. And, in general, it is better and more attractive to insurers to have one big loss and otherwise "clean" experience, than numerous small losses. A company with one big loss is going to be 'penalized' less severely than a company with many smaller losses, because having many small losses is seen as a sign that you'll face larger ones in the future. And the result of that formula is your EMR. 4. California, Delaware, Michigan, New Jersey, and Pennsylvania DO NOT allow combinable experience with other states and issue their own EMR's. How does a high EMR affect costs? An EMR of 1.20 would mean that insurance premiums will be 20% more than a company with an EMR of 1.00. That 20% difference is often passed on to clients in the form of increased bids for work. A company with a lower EMR has a competitive advantage because they pay less for insurance. In addition in the state of California, Cal OSHA defines a "high hazard" business having an EMR of 1.25 or greater. These company's are entered into Cal OSHA's special "high hazard" unit and are charge a penalty in addition to the cost of having the high experience modification. The good news is that EMR CAN BE LOWERED and improved. An effective safety program that eliminates hazards and prevents injuries is a good starting point. Fewer, or no, injuries and claims equate to a lower experience modification. In the world of IDA, injuries will happen, but the response can help keep EMR from increasing as much as it could without proper management. Having a plan to manage injuries and workers compensation claims is a must to lower the EMR. Reducing EMR gives a company an edge over competition when bidding out work and save money. Construction general contractors and owners are realizing the benefits of low EMR numbers and often prequalify companies before they even look at bids. Many IDA clients could not bid on certain jobs (Many large jobs) because of their high respective experience modification. Following are a few ways to lower the number of occurrences and severity of claims: 1. Develop a loss prevention program 2. When hiring, check employee safety and injury records 3. Ongoing monitoring of your philosophy and policy for a strong loss prevention program is essential 4. Track losses to identify their source eliminates trends before they become costly 5. Verify your experience mod and correct clerical, injury coding and subrogation errors. These happen! 6. Report incidents promptly and stay in touch with injured worker 7. Get injured workers back on the job as quickly as possible, thus reducing medical, legal, and temporary disability payments/reserves 8. Insuring prompt treatment reduces overall cost 9. Monitor open claims and analyze losses for incident repeaters and suspected fraudulent claims Common Errors As always, errors do occur when calculating experience modification and all clients should request their individual experience modification worksheets from either their respective WC Board. Some of the common errors are: 1. Typos on claims and payrolls 2. Reserves reported improperly 3. Wrap-ups not included (Payroll) 4. Credits for recoveries and reserve reductions are not applied/slow recovery 5. Multiple claims on one loss date The experience modifications are used by insurance companies to gauge both past cost of injuries, to predict future chances of risk, and how one company's historical losses compare with those of its peer group. "The good news is that EMR CAN BE LOWERED and improved. An effective safety program that eliminates hazards and prevents injuries is a good starting point Fewer, or no, injuries and claims equate to a lower experience modification." (Continued from page 85) EXPERIENCE MODIFICATIONS

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