Workers Compensation Information
Why do I need Workers Compensation Insurance?
Workers' compensation insurance is required by law in almost every state. Each state's rules and requirements vary significantly. We can help you handle these and other details.
Workers compensation insurance serves two purposes: It assures that injured workers get medical care and compensation for a portion of the income they lose while they are unable to return to work and it usually protects employers from lawsuits by workers who are injured while working.
A typical Workers Compensation policy provides coverage for:
· Medical expenses
· Lost wages
· Permanent disability
· Rehabilitation costs
· Death Benefits
The biggest challenge of business owners who buy workers compensation insurance is maintaining an affordable policy year after year. The best way to keep your workers comp premium low is by reducing losses. The less frequently accidents occur in your company, the more likely insurance companies are to provide you with cheap workers comp insurance.
While NCCI (National Council on Compensation Insurance) and individual insurance carriers may determine workers compensation insurance rates, below is a list of things you can do to find and maintain more cost effective workers comp insurance.
1. Implement a formal written safety procedures manual.
2. Hold regular “toolbox talks” about different workplace safety topics.
3. Train employees how to use available safety equipment properly.
4. Reward employees for demonstrating safe workplace habits.
5. Apply for and achieve a Drug Free Workplace Certificate.
Some of our Products/Programs
Being a veteran in this industry, we understand how financially difficult it can be to develop your own solutions. That is why we offer such a wide range of programs. Our comprehensive services give you the cost-effective, alternative insurance solutions you need. Additionally, as a policy holder you may receive the opportunity to earn additional income depending on what program you’re enrolled in. What more could you ask for?
Pay as You Go Workers Compensation program (PAYGO)
Are you simply looking for better cash flow? Of course you are, so why not take advantage of a Pay as You Go Workers Compensation program?
If you are in an industry that is hard to predict future payroll amounts, you may want to consider a pay as you go program. Pay as you go eliminates premium deposits, improves cash flow and reduces audit exposure.
How it works – You send your insurance company a workers compensation payroll report on a regular basis (usually monthly). They will use this information to bill you each month based on your actual payroll instead of your estimated annual payroll. This program is great for industries such as construction/contractors who may not know how many employees they need from month to month.
Benefits in most cases are:
· Improved cash flow
· Easy set-up
· Quick quote process
· Competitive rates
· Acceptance of higher risk clients
· Zero premium deposits and negligible initial cost
· Continuous renewal process
· Easy to understand monthly premium reporting
Pay As You Go Workers Comp policies allow you keep your working capital where it belongs….In your hands, not the insurance carriers.
Large Deductible Program
A deductible program is designed for large employers usually with multistate exposures. The size of the deductibles for these plans is generally in a range of $100,000 to $1,000,000 per occurrence. The insurer makes all payments as it would under a standard workers compensation policy. The insured then reimburses the insurer. The insured also puts up a security/collateral for deductible exposure.
Large Deductible plans can improve employers’ cash flow, reduce their insurance premiums, provide increased tax deductions, and give them more control over their Workers Compensation costs. They are usually more appropriate for employers that can afford the potentially large cash reserves required and any employer contemplating this type of plan should implement an effective workplace safety program.
Guaranteed Cost Program
A guaranteed cost plan is the most predictable type of insurance policy. In these policies, the premium is a fixed cost based on the final audited payroll, manual rates, and any applicable pricing programs. It is not subject to adjustment due to losses that occur during the policy term- instead premiums are charged on a prospective basis.
A rate is agreed on when the policy is created and is multiplied by the exposure base to yield the premium. The only variable affecting premium that should change between policy inception and audit is payroll. If the exposure base, for example: sales, is more or less than expected at the policy’s creation, the premium will be adjusted accordingly. Loss experience does not affect the premium.
A guaranteed cost plan transfers your risk to an insurance carrier. You pay a fixed rate for your term of coverage, but get no immediate reward for good risk management efforts or results.
Historically recognized as a vehicle for Fortune 500 companies, group captives have become a valuable tool for middle market companies trying to gain control of their insurance programs. Business owners are becoming more and more sophisticated in their purchasing strategies and captive programs allow them the ability to have long term control over their insurance while generating another profit vehicle.
If you are a top-of-class business for your industry, in regards to claims control, quality control and risk management, you are most likely a good fit for a captive. We work with the industry leaders of Captive formation and management.
A captive offers the customer the ability to have their own insurance company and in effect gives the customer the ability to increase net income, shelter and grow capital, and many other tax advantages, not to mention providing the flexibility to decide how and when to pay any claims.
Captive Insurance Company (defined) - A captive insurance company primarily insures the risks of its owners and sometimes related or affiliated firms and returns underwriting profit and investment income to those owners. These earnings would normally be retained by a traditional insurance carrier. Captives are insurers owned by the insured and organized for the main purpose of funding the owner's risks. These owners actively participate in decisions influencing its underwriting, operations and investments. One of the principle advantages are that when a captive owner pays premium, they are actually paying themselves. This creates immediate income, builds capital, and shelters investment income from taxation.
Having a membership with a society or an association can be a benefit. We can customize a specialty dividend program for associations that allows its members the benefits usually reserved for larger organizations. By grouping association members into one single large group, each member is eligible to participate in a program based on the group’s performance and combined loss ratios.
· No recapture clause, once dividends are paid they will never be recalled.
· Carrier interpolates between loss ratios, members receive dividends that are based on the actual loss ratio.
· Dividends are based on evaluations of group losses 6 and 18 months, members receive 50% of the earned dividend at each evaluation period.
· To be eligible for a dividend, audits must be completed and the policy must remain in effect for the full 12-month period.
We have many unique programs!
Give us a call!