The importance of “digging deep”, when conducting a thorough investigation when an injury is reported is a key factor to reducing your experience rating saving you money. Experience rating is a method used to determine pricing of premiums for different groups or individuals based on the history of their claims. Using historic data as a proxy for future risk, insurers use experience rating to adjust, set and plan accordingly on a group or individuals insurance premiums. The two main things affecting an employer’s experience rating with the compensation board are frequency and duration of claims.
Seeing that the compensation board are the ones who are responsible for finding reason and solutions to claims filed, employers benefit from providing them as much information pertaining to any pre-existing conditions or impairments. Successful claims management techniques on how to decrease the occurrence of claims by having benefits denied or decrease the duration of the claims through return to work programs, are constantly promoted in articles. Techniques showing mechanisms of limiting entitlement, by having claims constrained to an acute period of injury are rarely discussed, limiting other claims management techniques that would result in savings in workers compensation costs.
When reporting and managing claims, to try to minimize claim duration by keeping cost down having entitlement denied or limited to the acute period of recovery. Experience rating puts you in control of determining the entitlement, which is why it is important for claims to be monitored while having communication with the compensation board to determine whether the worker has reached their pre-injury state.