Experience Modification Rate (Mod Rate or EMR)
The Experience Modification Rate (EMR) has strong impact upon a business. It is a number used by insurance companies to gauge both the past cost of injuries and future risk. The lower the EMR of your business, the lower your worker compensation insurance premiums will be. An EMR of 1.0 is considered the industry average. (Source: Safety Management Group).
According to the Michigan Construction Users Council (MCUC), the following EMR chart indicates the relative effectiveness of a contractor's CSMS.
0.30 - 0.71 = Superior (Distinguished results)
0.72 - 0.81 = Effective (Impressive results, obvious commitment)
0.82 - 1.04 = Average (Within industry norm)
1.05 - 1.29 = Inadequate (Conspicuous past problems)
1.30 - 2.05 = Poor (Lack of safety involvement)
As you can see, safety is a serious consideration when choosing contractors to work on the construction project. Using this criteria will not only result in selecting a higher level of contractor safety, it will also result in selecting a contractor that will be more professional in all aspects of the contracted work that will be performed.
Knowledge Check Choose the best answer for the question.
2-8. Which term describes the number used by insurance companies to gauge both the past cost of injuries and future risk?
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