General Contractor’s Workers’ Comp Drops $101,207 in Just Two Years
Discover how a general contractor with 110 employees transformed their workers' comp program. Our comprehensive approach reduced their Experience Mod from 1.21 to 0.93, slashing premiums by $65,000 annually. Learn how strategic safety initiatives and claims management can significantly cut costs and improve bidding opportunities.
Business
A commercial general contractor with 110 employees and revenue of $52 million in 2006.
Situation
A 62% Workers’ Comp surcharge drove up the company’s Experience Modification Factor jumped to 1.12, costing them an additional premium of $185,000 per year. It also restricted them from bidding work for large corporations that required a 1.00 or lower Experience Mod.
Assessment
During the Risk Management and HR Assessment, the Experience Modifier Analysis revealed both an error and that it was being mismanaged. The Loss Analysis of the loss data from the previous four years and OHSA logs revealed that the number and severity of claims were significantly higher than industry averages.
Solution
Showed the general contractor how they were paying the insurance company $3 for every $1 paid in claims. Designed an aggressive rehab plan of action: installing a safety committee, including training and recordkeeping, providing administrative support for the company by running the WorkComp process, and training the safety coordinator. In addition, worked with the client in establishing a relationship with Occupational Medical Center, initiating a claim reporting system and a return-to-work process. Assisted in completing necessary job descriptions.
Result
Experience Mod went down from 1.21 to 0.93, with a projected modifier of .90. Because of a radical reduction in the number and size of Workers’ Comp claims, additional discounts were negotiated, lowering the premium cost from $430,302 to $394,000 in the first year and $365,318 in second year of working with them.
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