Three Practical Tips for Managing Your Workers' Compensation Insurance Expenses
If your business has employees, you should have a workers' compensation insurance policy. This coverage is critical because it ensures that the workers receive financial remuneration if they are injured while carrying out their professional tasks. In addition, the insurance cover will provide liability protection for your business. If you do not have an appropriate policy, injured employees could sue for compensation, leaving your company bankrupt. On the other hand, workers' compensation insurance can be an expensive long-term charge for your business, especially if you are in a high-risk industry. If you are concerned about the financial implications of this coverage, you should consider using these simple tips to manage your expenses.
Establish Workplace Safety Plans
The most reliable way to reduce your workers' compensation insurance expenses is to establish a safety plan to protect the employees from injury and diseases. Simply speaking, your insurance premiums will be determined by the level of risk in your workplace. If the insurer assesses your business and identifies numerous hazards in your operation, the cost of your policy will go up because multiple claims are bound to be filed. Therefore, if you would like to reduce the rates, you should establish measures to reduce the risks. For example, if you provide protective equipment, ergonomic workspaces and regular training, you will reduce the risk of accidents. As a result, you can negotiate lower premiums.
Create a Return-to-Work Program
You should think about establishing a return-to-work program for your workers. As implied, this is a plan which allows the injured workers to reintegrate into the workplace with ease. A good program will provide multiple benefits for your business, including the reduction of compensation claim expenses. In general, if you do not have a RTW program, you will need to wait for the injured employee to recuperate completely before resuming work. However, if you have this setup, your employees can perform light duties or work part-time during their recovery period. Consequently, you will reduce the amount of money paid as compensation for lost wages. Also, you should note that the RTW program will reduce employee turnover and improve worker-employer relations.
Review Your Insurance Policy
Finally, you should review your workers' compensation insurance cover on a regular basis. This process is of particular importance if you have restructured your business or made other significant changes such as employing temporary workers, changing the worksite or using independent contractor. You should ensure that the policy still provides sufficient cover. If you have made improvements, you could reduce your expenses.