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Sensitivity analysis and "what ifs" |
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order to better understand the effects of your past losses on your
current Experience Modification Factor, we can perform three types of
sensitivity analyses for your review. A brief description of each
analysis and its suggested use follows. |
| Aggregate Loss Sensitivity |
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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 |
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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. |
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Payroll Sensitivity Analysis |
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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. |
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Options |
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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 |
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To download a newsletter called "Manage Your Mod",
click here. This
newsletter refers to a software package called ModMaster, which is
available to Chartwell's clients.
Please
contact us if you're interested in having us
conduct sensitivity analyses for your company. |
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