Workers compensation premiums can quickly become the single largest insurance policy for many types of business. Companies in the service trades, construction or manufacturing pay relatively high rates for workers compensation insurance. At Safeguard Insurance, we want to help you control the cost of your insurance. Here are some tips to keep your workers compensation premiums low.
- Be proactive about employee injuries. This is probably the most obvious, but many business owners do not understand how important this truly is. Your workers compensation rates are directly affected by claim history. Nearly every business is assigned an experience modifier by NCCI (the rating bureau for Nevada). This experience modifier (also called the e-mod) is a credit or debit assigned to your business based on loss history. The e-mod can dramatically lower your overall rates if you have an excellent claim record. Conversely, it can cause a radical increase in premium if your claim history is adverse. Being proactive about employee injuries means ensuring all necessary safety equipment and precautions are taken. It means having consistent and meaningful safety meetings with employees. Business owners should consider a no-accidents rewards program and appoint a safety director or manager.
- Review your classification codes at least annually. How your employees are classified can make a huge difference in the price you pay for workers compensation insurance. It is critical you review what your employees are doing at least every renewal to make sure they are classified correctly. We commonly find businesses that have employees misclassified and, as a result, are paying too much for workers compensation. Business owners can also contact NCCI directly to discuss the classification codes used by their insurance carrier.
- Check for statutory payroll limits on your audit. Did you know that some states, including Nevada, have a statutory payroll cap per employee? For the purpose of workers compensation rating, only the first $36,000 of annual remuneration per employee is considered. We have seen many audits where that cap was ignored and the business owner was charged for the gross payroll, despite many employees exceeding the annual cap.
Lastly, if you not a customer of Safeguard Insurance, consider letting us provide you with a quote for your workers compensation insurance. With our multi-company approach, odds are we can help you find a better price with top-notch service.
Contact us today for a n0-obligation review of your workers compensation insurance.