May 2, 2012

Yesterday, NYCIRB Chief Actuary Ziv Kimmel said in an announcement that, effective October 1, 2013, New York Compensation Insurance Rating Board will increase the split point from $5,000 to $10,000.

New York Financial Services Superintendent Benjamin Lawsky has approved a change in the split point used by the New York Compensation Insurance Rating Board to determine experience modifications in the workers' compensation system.

New York has joined at least 40 other states in approving a change in the experience mod split point change. Claims under the new $10,000 threshold will be considered primary and will be weighted at 100% for the purpose of determining each New York employer's experience modifier, or X-Mod. Claims above $10,000 will be discounted.

NYCIRB did not estimate the impact on employers. National experts have said some employers will see their premiums decrease as a result of the change, while others (especially insureds with larger premiums and high loss frequency) could see premiums increase by as much as 50%.

This move might adversely affect some brokers with clients who have large premiums and high loss frequency because their clients will see a sudden increase in their 2013 workers compensation renewal premium.  Your hands are basically tied to take any action because your clients’ 2013 mod is derived from prior year claims that can go as far back as 5 years.

Workers Compensation Premium Recovery is the only answer to the current experience rating split point change.  This service offers to knock down current and prior years’ mods, obtain cash back returns, ensure future savings for your clients to keep, and provide a better underwriting profile to enter the renewal marketplace with.  Knocking down experience mods will certainly help your clients with the new experience rating split point change. There are no out of pocket expenses for you or your clients and we pay first-year and renewal commissions to referring brokers.