Skip to content

Understanding Experience Modification Ratings: A Guide for Business Owners

As a business owner, you know that keeping your workers safe on the job is not just good for them but also essential for your bottom line. Do you know that your safety record can impact how much you pay in workers’ compensation insurance? That’s where experience modification ratings (or EMR raings) come in. EMRs are complex calculations that determine whether your company is a high or low risk to insure based on its past claims history. Understanding EMRs is crucial if you want to reduce costs and improve workplace safety. In this article, we’ll break down everything you need to know about EMR ratings and how Field Control Analytics aids contractors in making informed decisions about safeguarding employees and protecting your business finances.

What is Experience Modification Rating (EMR)?

An experience modification rating (EMR) is a number used by insurance companies to adjust the premium rates for employers. The EMR is calculated using an employer’s record of workers’ compensation claims over a three-year period.

The purpose of the EMR ratings is to encourage employers to adopt safety measures to prevent workplace injuries and illnesses. A lower EMR indicates a better safety record and usually results in a lower insurance premium.

How Does EMR Impact Businesses?

EMR, or experience modification rating, is a key factor in how much a contractor pays for workers’ compensation insurance. EMR ratings are determined by a number of factors, including the number of claims filed by employees, the severity of those claims, and the amount of time it takes to resolve them.

Workers’ compensation insurance is a necessity for most contractors, but the cost can be prohibitive. An EMR is one way to help keep costs down. A contractor with a lower EMR will pay less for insurance than one with a higher EMR.

There are a number of ways that contractors can utilize FCA to lower their EMR. One is FCA’s safety orientation learning management system to provide training to employees on how to avoid injuries. Another is to have procedures in place for quickly and effectively resolving any claims that are filed.

The bottom line is that contractors need to be aware of their EMR and take steps to ensure that it stays as low as possible. Some general contractors will not work with trade partners who have EMRs higher than BLS industry average.  FCA’s technology will enable savings insurance premiums and make the workplace safer for everyone involved.


Factors That Affect EMR Ratings

There are a number of factors that affect EMR ratings. The most important factor is the company’s experience with workers’ compensation claims. A company’s history of claims will have a direct impact on its EMR rating. With FCA’s technology it can ensure contractors know where their workers are and that they are properly credentialed to be performing the work they should be. Adequate training is tied directly to safer job sites and reduced accidents and injuries.

A company’s history of claims will have a direct impact on its EMR rating. The number of claims a company has had, the severity of the claims, and the amount of time it takes to resolve claims all play a role in determining a company’s EMR rating. It’s imperative for contractors to automate their labor head counts and know where their workers are at all times to ensure they are doing everything in their control to eliminate potential frivolous claims. Utilizing FCA’s access control system, contractors are able to mitigate the number of false workers’ compensation claims filed each year and inaccurately affect their EMR.

Tips for Reducing Your EMR

When it comes to your experience modification rating (EMR), there are a few things that FCA can do to help reduce your rate. Here are some tips:

  1. Credential and track your workforce so that you can review your loss history and identify any areas where you may be able to improve.
  2. Make sure you are properly classifying your employees and their job duties including cost code tracking.
  3. Implement a system that automates the tracking of headcounts and hours on site.  The under reporting of hours on a jobsite negatively impacts EMR.

We hope this guide has given you a better understanding of experience modification ratings, how they are calculated, and why it’s important for contractors to utilize a system like FCA to keep an eye on their own rating. By staying up-to-date with your EMR, you can ensure your company receives the best rates possible from insurers and maintain a good reputation in the industry. Don’t forget that prevention is key when it comes to minimizing workplace accidents, so take the necessary measures today to protect both yourself and your employees!