At Mooney Insurance, we enjoy working with local businesses. Very frequently, we can help them reduce workers’ comp and other insurance premiums in a variety of ways. Review these tips to reduce Arizona worker’s compensation premiums to understand how we work.
Suggestions to Reduce Your Workers Comp Premiums
You can’t change everything about your worker’s comp premiums. For instance:
- Your industry and your workers will have standard business classifications. A company that works with hazardous chemicals is likely to get assigned a higher rate than a business that sells floral arrangements.
- Within any business, you also may have some jobs that are riskier than others. An accountant won’t generally need to take the same risks performing assigned tasks as a crane operator.
- Insurers also consider your payroll in their calculations. Insurance companies will multiply the rate by payroll to come up with a base premium amount to charge.
Your industry, jobs, and payroll may be set. What you can do is to make sure that you have accurately classified your business and individual workers. You should also make sure that you haven’t over-reported your payroll numbers. Mistakes with business and job classifications and payroll numbers are common sources of incorrect premiums. You can work with your insurance agent to make sure that insurance companies have the right factors to plug into their calculations.
Workers Compensation Premium Modifiers
After the insurer has calculated a standard price for your kind and size of the business, they will multiple that price times a modifier. This factor gets set based upon their view of your unique safety record and environment when compared to similar businesses. If they consider your company safer than average, they may assign you a modifier of less than 1.0. For instance, a modifier of only .5 could reduce your premiums by 50 percent. On the other hand, a modifier greater than 1.0 could increase your premiums.
Over time, safety and risk management programs can help reduce your claims history and of course, your modifier. Many insurers will even offer credits for steps that you take right now to lower the chance and amount of future claims. For instance:
- A return-to-work program could offer flexible jobs and hours to employees who aren’t ready to return to their old position but could do other tasks. These programs help ease employees back to work. In addition, they can help lower claims for lost wages.
- Safety training can help empower managers and workers to do tasks the safe way and mention safety concerns they observe. They can also help employees understand which sorts of incidents to report.
- Ensure employees understand their job descriptions and don’t exceed expectations in a way that’s not safe. For instance, if your accountant steps in to move heavy boxes and gets injured, that could impact future workers’ comp premiums. Help employees understand that they can only help if they perform tasks that they know how to do safely.
- Get your business evaluated for common hazards. Lots of small businesses rely upon their agents and insurers as risk management partners, and you should be able to take advantage of these resources as well.
Get Personalized Assistance With Workers Comp and Safety Programs
Visit our small business insurance page to learn why other companies trust Mooney Insurance as a valuable partner for insurance and risk management. Then contact us by phone or email to learn exactly how we can help your business reduce premiums and get more value from your relationship with our insurance partners and us.