How to Save Money on Workers Compensation Insurance
Whether you’re a brand new mom-and-pop operation or a larger, more established company, you’re probably wondering how to save money on workers compensation insurance. Although it might seem like just a nice add-on, all businesses are required by law to carry workers comp. To learn how to save money on workers compensation insurance, we’ve created a list of ways to keep costs low.
At the end of the day, one of the easiest ways to save money is by teaming up with a local professional employer organization, or PEO, like Canal HR.
What is Workers Compensation Insurance?
Before you can learn how to save money on workers compensation insurance, you first need to know what workers comp is. Workers compensation insurance provides assistance to employees who have been injured or who have fallen ill in the workplace. This insurance is meant to assist both the employer and the injured employee. Coverage can include medical expenses, ongoing care, lost wages, and funeral expenses.
Although businesses in all states require some form of coverage, workers comp costs can vary based on state and industry. Businesses are grouped into “classes” with similar organizations and rates are determined based on the prior fives years’ history of costs and injuries. Businesses can also have costs determined based on a good history of little or no injuries, and in this case these businesses pay a low premium. The opposite is true for businesses with a poor history of injury.
Tips on How to Save Money on Workers Compensation Insurance
To ensure that you know how to save money on workers compensation insurance, follow these five tips below:
Choosing workers’ compensation insurance is similar to buying car insurance or health insurance—it’s important to look around for the best policies. Working with a PEO can help you negotiate the best rates because they have the advantage of servicing a large number of employees, not just your business.
It’s also smart to have a good professional relationship with your insurance carrier. By inviting a company representative to check your workplace for any potential hazards and by keeping up with maintenance, you can avoid any potential issues.
Have a Documented Safety Program in Place
A written safety program shows insurance companies that you are committed to creating a safe workplace for your employees. Though a documented safety program isn’t required in all states, it can help your business in the long run if you require training for your workers so that you’re doing your due diligence to avoid workplace injury. Be sure to require employees to sign off on program material.
Have a Return-to-Work Program
Although accidents will inevitably occur in the workplace, establishing a return-to-work program can help you save money. Anytime a claim stays open, your insurance money is charged, which means those costs are passed to your business. A workers comp claim should be closed as quickly as possible, and one way to do that is to get the employee back to work, even if it’s only part-time.
Encourage a Substance-Free Workplace
This one might sound obvious, but drug or alcohol use in the workplace is an easy way for accidents and injuries to occur. Though the majority of companies have policies that express no tolerance for use in the workplace, it’s important to remind employees of this. Even drug or alcohol-related injuries that are no fault of your own can end up costing your business.
Have Proper Job Classifications
By clearly defining each position, employees can avoid performing duties outside the scope of their position. A salesperson shouldn’t be lifting and transferring large boxes of printer paper if this isn’t in their job description. By staying within the required duties of their positions, your employees can avoid potential injuries.
How a PEO Will Save You Money on Workers Compensation Insurance
While it’s possible to do all of this on your own, running a business is already hard enough, so why act as your own HR and payroll department? By working with our team at Canal HR, a professional employer organization (PEO), you will learn how to save money on workers compensation insurance so that your focus stays on the many other pieces of running a business.
Canal HR is a regional leader in keeping company’s costs low when it comes to workers comp policies. Here are some of our risk management services provided to our clients to create a safe work environment and keep costs low for our clients:
- Elimination of workers’ compensation down payments
- Negotiation and obtain of workers’ compensation insurance coverage
- Investigation into fraud
- Elimination of workers’ compensation audit and audit premium
- Risk management safety inspections
- Periodic safety training provision
- Process and manage workers’ compensation claims
- Handle workers’ compensation hearings
- Maintain OSHA logs
- Coordination of return-to-work program
When you work with Canal HR, you have a team of HR professionals who specialize in keeping workers safe and employers’ costs low. Lighten the workload by handing your workers comp related duties over to specialists at Canal HR and contact us today!