What is an Experience Modification Rate (EMR or X-Mod)? 

A workers’ compensation experience modification (commonly called Experience Mod, EMR, Mod, or X–Mod) is a numeric factor used by insurance companies to adjust a business’s workers’ comp insurance premium based on its claim history compared to other companies in the same industry. 

• It reflects how safe or risky your business is compared to the industry average. 
• Baseline: An X-Mod of 1.00 means your claims experience is average. 
• Below 1.00: Better-than-average claims history (safer workplace) → premium credit/decrease. 
• Above 1.00: Worse-than-average history → premium debit/increase. 

How It’s Calculated:

• Based on past 3 years of payroll and claim data (excluding the most recent policy year). 
• Compares actual losses to expected losses for your industry and size. 

How Your Experience Mod Can Affect Bidding:

Here are some pollution scenarios contractors regularly face:

• Prequalification Requirement: 
  • Many GCs and project owners require an X-Mod below 1.00 to bid. 
  • Public projects and large private-sector jobs often disqualify contractors with high mods. 
• Cost Competitiveness: 
  • Higher X-Mod = higher insurance premiums = higher job costs. 
  • That can make a contractor’s bid less competitive. 
• Reputation and Risk: 
  • A high X-Mod signals a poor safety record, increasing perceived risk. 
  • GCs and owners may see it as a red flag for future injuries or project disruptions. 

At What Experience Mod Will Cal/OSHA Get Involved? 

Cal/OSHA does not automatically get involved based solely on a high X-Mod, but an extremely high X-Mod (usually above 1.25–1.50) can trigger scrutiny for: 

• AB 302 (California law): 
  • Requires some public agencies to report contractors with high X-Mods. 
  • May affect contractor eligibility for public work. 
• High-Hazard Employer Program (HHEP): 
  • Cal/OSHA may target employers with: 
    • High injury/illness rates, 
    • High X-Mods (often 1.25 or higher), 
    • Serious or repeated violations. 
  • You may be placed on a targeted enforcement list and be subject to inspections. 
• Public Works Disqualification: 
  • Contractors with excessive X-Mods and poor safety records may be disqualified from bidding on certain public projects. 

Best Practices for Contractors 

• Monitor your X-Mod annually. 
• Implement a safety program and return-to-work policy. 
• Investigate all incidents and reduce claim frequency/severity. 
• Work with Morris & Garritano to understand how your X-Mod is calculated and what drives it.