Workers’ compensation is the nation’s oldest social insurance program: It was adopted in most states, including California, during the second decade of the 20th century. The workers’ compensation system is based on a trade-off between employers and employees. Employees are entitled to receive prompt, effective medical treatment for on-the-job injuries or illnesses no matter who is at fault and, in return, are prevented from suing employers over those injuries.
In most states, employers are required by law to have workers’ compensation insurance, even if they have only one employee. And, if an employee gets hurt or sick on the job, employers are required to pay for workers’ compensation coverage. Workers’ compensation insurance provides six basic benefits:
- Medical care
- Temporary disability benefits
- Permanent disability benefits
- Supplemental job displacement benefits
- Vocational rehabilitation & retraining
- Death benefits
A number of factors go into determining the annual premium your insurance carrier will charge. These include your industry classification, your company’s past history of work-related injuries (known as your ex-mod or experience modification), and your payroll.
Ex-mod is an abbreviation for experience modifier. Workers’ compensation experience rating is designed to increase or decrease an employer’s annual premium based on their historical loss experience. The WCIRB compares an insured’s loss experience with the loss experience of other insureds in the same industry.
In general, an employer with better-than-average loss experience receives a credit mod (mod of less than 1.00) which reduces their premium. An employer with worse-than-average loss experience receives a debit mod (mod of greater than 1.00), which increases their premium.
Yes. OmegaComp HR provides your insurance carrier’s auditor with historical payroll information. Conduct the audit on our premises for you and reconcile the audit disputing on your behalf if necessary.
For a comprehensive set of FAQs for employers about Workers’ Compensation in California, click here.