Why Your Insured Should Consider Combining Multiple WC Policies
If your insured is running a business with multiple entities and locations, you probably already know how messy workers’ comp insurance can get. Different policies, different renewal dates, multiple audits, and trying to keep track of it all—it’s a lot. But here’s something agents may not realize: combining workers’ compensation coverage under one policy could lower an insured’s costs, especially when it comes to their NCCI Experience Mod (EMR).
An experience mod is basically a scorecard that compares a company’s actual claims history to what’s expected for businesses. A 1.0 mod is considered average. If the risk is performing better than average—with fewer or smaller claims—it gets a mod below 1.0 and saves money on premiums. If the claims are higher, the mod goes up, and so do the costs. Here’s where it gets interesting: the formula puts a lot more weight on frequent, smaller claims than on one-off, large claims. So, if the claims are scattered across different policies or business units, they might miss out on a chance to manage the risk more strategically.
When you combine the coverage, you also combine the payroll and claims history. That’s a big deal. The more payroll you have under one roof, the more predictable the expected losses are, and the less each claim impacts the mod. It also opens the door to something called a “credibility factor,” which NCCI uses to give larger employers more influence over their mod. In short, bigger numbers mean more control and more opportunity to save.
Something you may not know is that to even qualify for an experience mod, you typically need to have at least $10,000 in annual premium or 2 years of $5,500 average premium, but these figures may vary based on jurisdiction and classification. Smaller entities on their own might not hit that mark, but when you group them, you often do. That means the insured could transition from a standard, one-size-fits-all rate to one that reflects their performance. If they’ve invested in safety programs, return-to-work policies, or just have a strong culture of taking care of their people, that should count for something. Combining coverage makes sure it does.
At the end of the day, this isn’t just about saving money, though that’s a huge benefit. It’s about running smarter, gaining visibility into the risk, and setting the businesses up for long-term success. If you’re not sure where to start, talk to your BDI Underwriter about whether a combined policy makes sense and if the risks are considered combinable. You might be surprised at how much simpler—and more cost-effective—things can be.
