For most small business owners, paying for workers’ compensation insurance is just another annual expense that must be dealt with. You know that workers’ comp insurance helps to protect your team if they are injured or become ill after a workplace accident, but there’s no way you can save on this essential coverage, is there?
That’s where you’re wrong! Even though there are certain aspects of this important business insurance coverage that you cannot change, there are ways that you and your employees can work together to help lower your annual workers’ compensation costs and put safety first in your workplace. Keep reading to learn more.
Is it Possible to Lower My Worker’s Comp Insurance Costs?
The short answer is, yes. You can reduce your workers’ compensation costs by being proactive and cultivating a culture of safety first within your company. However, it’s important to understand what you can and cannot change to help lower your insurance rates. A few of the factors that you likely can’t change include:
Who Has to Pay
If you’re a Wisconsin employer with three or more employees, you need to carry Workers’ compensation insurance. If you have fewer than three but have paid combined gross wages of $500, you also must carry Workers’ Compensation insurance. There are also special rules for farmers, that differ from other employers. Finally, if your business is based in Wisconsin and has employees in other states, you’d need to follow the local state’s rules for your out-of-state employees. Similarly, if you’re a business based outside of Wisconsin, you’d need to follow Wisconsin’s rules for your Wisconsin employees.
For other states, the worker’s compensation requirements are often based on the number of employees but not necessarily the same number as Wisconsin. There may also be different rules for different types of industries.
A classification system determines workers’ compensation rates. To make these rates as fair as possible, businesses within the same industry and those who perform similar functions are assigned the same classification. These classifications are also determined by the likelihood that your employees will be injured on the job, meaning that rates can vary significantly between different businesses. For example, if you operate a roofing repair company, your employees are much more likely to become injured than the employees at your local accounting offices—and you will pay higher workers’ compensation rates than they do.
What Can I Change?
Your Insurance Agent
Switching to an independent agency over a captive agent is a great choice for any small business. This is because independent agents offer you much more variety and coverage choices. They are not contracted to represent a single insurance provider simply but instead can help you compare workers’ comp insurance quotes from multiple providers—on average 3 to 8 different companies—all at once. So, while your rates may not budge, you may be able to enjoy more significant savings in other areas when you have access to a wide variety of insurance providers.
Put Safety First
Implementing a documented safety program can also help reduce your workers’ comp costs by demonstrating to your insurance provider that you are serious about protecting your employees from accidents on the job. But to be eligible for potential discounts, you’ll need to document all safety training hours and updates, as well as having employees sign off that they have received and read all safety materials provided by the company.
Start a Return-to-Work Program
Training and onboarding new employees is a long and expensive process. And losing a valuable employee to an injury can be very costly to your company. Not only will you have to pay more in workers’ comp costs while they recover but you may have to bring new staff onboard to replace them. A return-to-work program is designed to allow injured staff to return to their duties as soon as they are deemed medically able, even if that is in a diminished role or on a part-time basis.
Contact Erica Boll Insurance Today
Interested in learning more about how you can save on small business insurance coverage? Call (920) 898-5781 or contact us today for more information.