Calculators › Premium & Pricing

Experience Mod Calculator (NCCI)

Estimate a workers compensation experience modification factor with the NCCI formula: primary/excess split, weighting, ballast and the medical-only reduction.

How the experience mod calculator (ncci) works

The experience mod compares an employer’s actual losses to the losses expected for its payroll and class codes. Each claim is split into a primary part (up to the split point) and an excess part; primary losses count fully while excess losses are weighted down, so frequent small claims affect the mod more than one large one.

Formula

Mod = (Ap + W × Ae + (1 − W) × Ee + B) ÷ (E + B), where Ap/Ae are actual primary/excess losses, Ep = E × D-ratio, Ee = E − Ep.

How to use it

  1. List each claim in the three-year experience period and whether it was medical-only.
  2. Enter total expected losses, the D-ratio and the split point from the rating worksheet.
  3. Enter the weighting (W) and ballast (B) values for the employer’s size.
  4. Read the mod and its premium impact.

Worked example

With $68,000 expected losses, a 0.36 D-ratio, W = 0.12 and B = $32,000, four claims totalling $85,850 produce a mod of 1.15 — a 15% debit. Primary losses of $40,105 against $24,480 expected drive it.

Frequently asked questions

Why do small claims matter so much?

Because the primary portion of every claim counts in full. Ten $5,000 claims add $50,000 of primary losses; one $50,000 claim adds only the split-point amount as primary.

What is the ERA medical-only reduction?

Under the Experience Rating Adjustment, most NCCI states count only 30% of medical-only claims, which rewards early reporting.

Guides

Related calculators