Denver Temporary Agency - Workers' Comp 101: How is My Premium Determined?

  • Posted by: J. Kent Gervasini |
  • 3/26/14 |
  • 6:15 PM
Denver Temporary Agency - Workers' Comp 101: How is My Premium Determined?

Denver staffing agencies provide professional, administrative and light industrial staff to employers across many industries and sectors. However, all staffing is not the same, and neither is each workers' compensation (WC) insurance rate for a specific job or position. For example, the assumption that all office workers fall under the WC Code 8810 is not correct; although this is a widely held believe within the business community.

Risk is Inherent in Each and Every Job
Each job assignment has unique qualities, considerations, tasks and risks that are carefully analyzed and reviewed by the employer’s WC insurance carriers’ underwriters. For example, the workers’ compensation rates for an Administrative Assistant in a physician’s, lawyer’s or public relation’s office are all different, even though the Administrative Assistant works in an office environment. Therefore, the premium amount that you as a Denver employer pays for worker’s compensation insurance is based on several factors including:

  1. Rates
  2. Nature of your business, and
  3. Experience modifier, if your organization qualifies for one.

Workers’ Comp 101: How Is My Premium Determined?
In 2014, J. Kent Staffing issued 457 W-2s. For each worker, workers’ compensation insurance was provided. During the staffing process, J. Kent’s Staffing Managers are constantly working with our insurance carrier, Pinnacol, and their underwriters on WC rates for the positions they are staffing. So how is the rate for employers determined? Here is a quick overview of a very complex process:


  • The National Council on Compensation Insurance (NCCI) establishes loss cost rates for Colorado based on data provided by all workers’ compensation insurance carriers in the state.
  • After the Colorado insurance commissioner approves the loss cost rate, each carrier, adds its expenses to determine final rates.
  • This number factors into your premium

Classification Codes

  • Your organization will be assigned a workers’ compensation classification code that best describes the industry (e.g., paint, retail, oil and gas, healthcare etc.).
  • This code helps describe the history of injuries associated with the industry and is used to help determine your premium.

Experience Modifier

  • If your organization meets the average premium requirements, your earned experience modifier (or “E-mod”) will be applied. 
                                           E-Mod - What Is It?
  • E-mod is a numerical rating assigned to your policy, also by NCCI, based on your specific organization’s accident history. 
  • This number is compared to the average premium rate of companies in your industry.


  • If your accident history is lower than the industry average and qualifies for calculation, your E-mod will be less and will help lower premium.
  • However, the overall final premium may not be reduced if the other adjustments warrant increases in premium. For more information about how your WC insurance premium is determined, contact you WC carrier’s underwriter.

The information in the article above is intended for general education and information purposes only and should not be relied upon as a substitute for professional, legal, and/or accounting or your insurance underwriter’s advice.


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