Lost-Time Workers Comp Claim
Also known as: LT Claim
Distinguished from Medical-Only claims (treatment but no time off). Lost-Time claims weigh MUCH heavier on Experience Modifier than Medical-Only — often 5-10x the impact. Return-to-work / modified-duty programs are designed to convert Lost-Time into Medical-Only.
Because it triggers indemnity (wage-replacement) benefits once the injured worker is out past the state-mandated waiting period—typically 3 to 7 days—a lost time claim weighs far more heavily in NCCI's experience-rating formula than a medical-only claim, directly pushing up an employer's experience modification factor.
Real-world scenario
Consider Cedar Ridge Framing LLC, a 14-employee residential carpentry crew in Georgia with an annual carpentry payroll of $780,000. Their workers' compensation policy carries a manual premium of $62,400 at a rate of $8.00 per $100 of payroll. One morning a framer falls from a scaffold and fractures his hip, missing 11 weeks of work — well past Georgia's 7-day waiting period — which turns a would-be medical-only file into a true lost-time claim.
The adjuster sets an initial case reserve of $140,000. Medical bills for surgery and physical therapy reach $68,000, and temporary total disability wage benefits run $620 per week for 11 weeks, totaling $6,820. A 5% permanent partial disability rating adds another $9,500, and the adjuster books $4,200 in legal and investigation costs. The final incurred loss lands at roughly $88,520 — versus the $900 average cost of a comparable medical-only claim.
Because lost-time claims count at full value in the experience mod formula, this single file pushes Cedar Ridge's mod from 0.98 to 1.34. Applied to their next manual premium of $62,400, that 0.36 swing adds about $22,464 in surcharge for each of the next three policy years — over $67,000 in extra premium — dwarfing the $500 deductible on the claim itself and illustrating why loss prevention beats cleanup.
How it affects your premium
A lost-time claim's true cost — and its ripple through your premium — is driven by more than the injury itself. The biggest factors underwriters and the rating bureau weigh include:
- Indemnity (wage-replacement) duration: Every additional week of disability benefits compounds the claim value and lengthens the reserve, unlike a one-time medical bill.
- Experience mod impact: Lost-time claims count at full incurred value in the mod formula, so a single serious file can surcharge premium for three straight years.
- Claim frequency vs. severity: Bureaus weight the number of lost-time claims heavily; several small ones can hurt your mod more than one large one.
- Class code hazard level: High-risk NCCI class codes (roofing, framing, trucking) carry higher rates and larger expected losses per claim.
- Permanent disability rating: A permanent partial or total impairment award adds structured indemnity payments long after medical treatment ends.
- Return-to-work speed: An active return-to-work program converts lost-time days into modified-duty days, shrinking indemnity cost.
- Reserve accuracy: Adjuster case reserves feed the mod at valuation date, so open, over-reserved claims can inflate premium before the file even closes.
Common misconceptions
Myth: A lost-time claim is just a workers' comp claim where someone got hurt.
Reality: Not quite — a claim only becomes lost-time once the injured worker misses more than the state's waiting period (often 3-7 days) and starts collecting indemnity wage benefits. A file where the worker is treated and returns the same day is a lower-cost medical-only claim.
Myth: One lost-time claim will only raise my premium for the year it happens.
Reality: In reality, a lost-time claim feeds your experience modifier for a three-year experience period, so the surcharge follows your premium across multiple renewals long after the injured worker recovers.
Myth: If I just pay the small claims out of pocket, they won't count against me.
Reality: Any reported lost-time claim enters your loss run and the mod calculation at its full incurred value, regardless of your deductible — paying medical bills informally can even violate your policy's reporting terms.
Frequently asked questions
What's the difference between a lost-time claim and a medical-only claim?
How long does a lost-time claim affect my workers' comp premium?
Can a return-to-work program reduce the cost of a lost-time claim?
Do lost-time claims show up when I shop for new coverage?
Does my deductible keep a lost-time claim off my experience mod?
Sources cited
Need lost-time workers comp claim coverage?
Compare quotes from 10+ commercial insurance carriers in 5 minutes. Free, no contact info required.
Get My Quotes →