Read This Before You Speak With Your Insurance Agent About Workers Compensation
You probably have some questions, and we have found that most of them can be answered quickly. From our experience, here are the top questions our new clients ask us.
Who Does Worker’s Compensation Cover?
Like most people, you probably know what worker’s compensation is for, and if you have been working for any significant amount of time, you may have had to file a claim. However, many business owners ask us about required coverage for independent contractors, temporary employees, and other classifications of people working for them. So, let’s see who this covers.
Workers comp is insurance for your employees who are injured while they are at work. This doesn’t mean they have to be on the physical site of your business. For example, field technicians injured while performing work at a job site are also covered.
What is This Going to Cost Me?
This is probably the number one question we hear. And, there’s nothing wrong with that because every business has budgets to maintain.
Workers comp rates are calculated by the size of your payroll and the classification of the types of work done at your company. The rate calculated based on ration of the cost per $100 of your payroll. If you have a large payroll, you will pay higher rates.
Additionally, other factors are considered including your number of claims and how they compare to other companies in your industry.
What Can I Do To Lower My Costs?
There are a few steps you can take to keep your worker’s compensation rates low.
- Have a proactive employee safety program and accident review committee. Creating a safety program itself won’t necessarily lead to lower rates. However, the program makes safety a priority in your company. Involve your employees and conduct investigations into accidents to see if you can make things safer.
- Make sure your business and all of your employee positions have been properly classified. Improperly classified positions can lead to higher rates. Make sure the title of the job matches the work your employee is doing.
- Talk to your contacts in your industry and see what they have done to mitigate their costs. Business owners are adaptable and solve problems. They may have ideas you never considered.
Can I Exclude Myself From Workers Compensation?
If you are a corporate board member or an officer of an LLC and don’t want to buy workers comp for yourself, you can file for an exemption. This could save you some money but it also means you won’t be covered if you are injured on the job. However, it may not be a problem as long as you have a personal insurance plan.
My Last Insurance Company Said they Wanted to Do An Audit, Why?
When your policy is close to expiring your insurance company may want to conduct an audit. They want to make sure there have not been any substantial changes to your business or to your employee’s tasks.
This is normal and you shouldn’t worry about it.
You have a lot to do when it comes to running a business. At Flagler Financial we help business owners by explaining and handling the struggle and confusion of workers comp laws and regulations.