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Sensitivity analysis and "what ifs"
In order to better understand the effects of your past losses on your current Experience Modification Factor, we will perform three types of sensitivity analyses for you.  Here is a brief description of each analysis and how to use each.
Aggregate Loss Sensitivity
  This analysis varies your three year aggregate loss amount in percentage increments. Each loss in the database is increased and decreased by the percentages shown on the aggregate loss sensitivity report.  The resulting modification factor is calculated for each scenario.  This analysis is be used to predict the value of certain loss control or post-injury treatment programs that decrease severity of losses. It also clearly demonstrates the cost, through a higher modifier, of increased loss severity. For an example of this analysis, click here.
Specific Loss Sensitivity
  This analysis demonstrates the impact that each loss has on the modifier by calculating its contribution to the modifier and what the modifier would be without the loss.  This analysis is used to estimate the value of loss control programs that decrease loss frequency.  It also shows the direct cost of each loss through the resulting increased Experience Modification Factor. For an example of this analysis, click here.
Payroll Sensitivity Analysis
  This analysis demonstrates the impact that changes in payroll would have on the modifier.  The change in the modifier per $100 of payroll is calculated for each payroll code.  There are several ways that payroll levels might be affected.  This analysis will help you evaluate the savings or increased cost of any expected changes in payroll amounts. For an example of this analysis, click here.
Options
  We can perform customized “What ifs” at your request.  Any of the input parameters can be varied and we can compute the resulting Experience Modification Factor quickly and easily.
Learn more
  To download a newsletter called "Manage Your Mod", click here. This newsletter refers to a software package called ModMaster, which Chartwell licenses to provide experience modifier analysis for its clients.

Please contact us if you're interested in having us conduct sensitivity analyses for your company.

 


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