Arizona workers’ comp experience mod after acquisition
get the Arizona workers’ comp number on firmer ground.
The seller’s rate and the seller’s experience mod are not the same thing. Check both before you assume what the acquired business will cost to insure.
The short answer
For an Arizona acquisition, collect the current experience-rating worksheet, ownership facts, payroll, and loss records. NCCI provides the ownership-reporting process; Arizona DIFI publishes workers’ compensation filing resources, including carrier rate deviations. A statewide rate change does not establish the acquired employer’s premium or post-close mod.
Put it into practice- 01Find the right records.Match the acquired employer to the policy, rating worksheet, payroll, and loss runs.
- 02Confirm the state path.Use the applicable regulator, carrier, and rating-organization process.
- 03Keep the budget honest.Separate the seller’s documented result from unconfirmed buyer assumptions.
do not confuse the filed rate with your company’s result.
Arizona DIFI’s filing resources include carrier deviations to NCCI workers’ compensation rates. That is a reminder to separate the underlying rate basis, insurer pricing, and the employer’s experience factor when reviewing cost. A statewide announcement is not a quote for the target.
Ask the broker which assumptions produced the seller’s current premium and which will be used for the buyer. Record the payroll period, classifications, rate basis, and mod effective date. A percentage change in one input cannot explain the whole post-close price.
References: Arizona DIFI: workers’ compensation rate filings · NCCI: ABCs of experience rating
give NCCI the ownership facts through the right process.
NCCI’s ERM-14 process is used to report ownership changes, mergers, consolidations, and combinations. Coordinate with the carrier and broker on the required submission, deadlines, and supporting information for this risk. Keep the before-and-after ownership chart ready.
Explain which operations and employees continue, which entities are acquired, and whether the business is joining other commonly owned companies. Do not assume a new FEIN, a renamed business, or separate policies alone determine whether experience is retained or combined.
References: NCCI: ownership reporting and ERM-14
make the worksheet part of the acquisition file.
Match the current rating worksheet to the target’s entities and effective dates, then connect it to payroll and dated claims records. If the target is insured through a parent or PEO, identify whose experience and exposure records you have actually received.
Carry unresolved rating treatment into the closing handoff and forecast assumptions. Ask the broker to retain the submission receipt and eventual determination. A filing that has been submitted is not a confirmed buyer mod, and a lower premium estimate is not proof of an approved correction.
the Arizona acquisition handoff.
A coordination record, not a calculation of your mod. Put the supporting document and actual deadline beside each item.
| Check | Evidence to keep | Who to involve |
|---|---|---|
| Arizona pricing basis | Carrier rate basis and any applicable deviations | Carrier and broker |
| NCCI ownership submission | ERM-14 facts, submission, and determination | Authorized filer and carrier |
| Ownership facts | Before-and-after chart and continued operations | Buyer and seller counsel |
| Current rating | Worksheet, payroll, classifications, and loss records | Seller and broker |
| Buyer assumption | Estimate status and eventual determination | Carrier, broker, and finance lead |
Good to know
your questions, answered.
Does buying a Arizona business give me a new experience mod?
Not automatically. The applicable rating plan and transaction facts determine the treatment of experience. Confirm the outcome through the carrier and relevant rating organization rather than assuming the new owner starts fresh.
What if the seller does not have a current worksheet?
Ask the carrier or broker whether the employer is experience-rated, which entities are included, and where the rating records can be obtained. Do not invent a factor to fill the gap; state the budget assumption and what remains unverified.
More to protect. Less to manage.
take a better-supported number into the deal.
Riza helps organize the Arizona ownership questions, policy records, and cost assumptions alongside your advisers. Start with the business you’re buying and its current program.
A broker will confirm the scope and next steps with you. Agree a secure route before sharing confidential deal records.