Business Insurance

Experience Modifier (EMR)

The experience modifier (EMR or ex-mod) rewards businesses with below-average workers comp losses with lower premiums and penalizes those with above-average losses.

Last reviewed: May 2026 · Editorial methodology

Definition

The experience modifier (EMR) is a numerical factor developed by the National Council on Compensation Insurance (NCCI) or a state rating bureau that adjusts a company's workers compensation premium up or down based on its three-year claims history relative to other businesses in the same class. A modifier of 1.00 is the industry average; a business with an EMR of 0.80 pays 20% less than the base rate, while a business with an EMR of 1.30 pays 30% more. For a company with a $100,000 base workers comp premium, the difference between a 0.80 and a 1.30 EMR is $50,000 annually — a powerful financial incentive for workplace safety investment. EMR is calculated using a formula that weights frequency of claims more heavily than severity, meaning many small claims can hurt more than one large one. Many general contractors require subcontractors to have an EMR below 1.00 or 1.10 as a condition of bidding on projects. Businesses can dispute the EMR calculation if they believe a claim was incorrectly included, and working with a workers comp specialist to audit EMR data is often worthwhile.

Where this term matters

Business Insurance →/business/workers-compensation →/business/contractor-insurance →

Tip

Glossary definitions are educational. Always check your own policy language — insurers can define common terms differently from one another. When in doubt, request a written explanation from your agent.

Related terms

Workers Compensation InsuranceWorkers comp provides no-fault benefits to injured workers while shielding employers from most personal injury lawsuits arising from workplace accidents.Workers Comp Class CodeWorkers comp class codes categorize job duties by their injury risk level, with each code carrying a rate per $100 of payroll that forms the foundation of premium calculation.Exclusive Remedy DoctrineThe exclusive remedy doctrine is the cornerstone of the workers compensation system, trading workers' right to sue for guaranteed no-fault benefits regardless of fault.
Source: Cover Forge USA editorial team|Last verified: May 2026|Methodology
Definitions are educational and may be simplified. Always refer to your policy contract and consult a licensed agent for terms that affect coverage decisions.
CF

Cover Forge USA Editorial Team

Editorial Lead

This article was researched and written by the Cover Forge USA editorial team against federal sources (NAIC, CMS, FEMA, DOL, SSA, state DOIs) and standard policy forms. Bylines organize content by topic — they do not assert individual licensure. See our editorial-policy for details.

Reviewed June 2026

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