Connecting the Dots: Claims Management and Workers’ Comp Premiums
Staffing Workers’ Compensation
No staffing business owner ever wants to get the call that an occupational injury has occurred and a claim needs to be filed. It’s no secret your workers’ compensation (WC) claims directly impact premium. Injuries can also affect productivity, morale, training…etc. That’s why it’s so important to effectively manage the safety and wellbeing of your workforce.
Here are four key considerations in regards to WC premiums and claims:
1. Frequency vs. Severity
Many individuals are under the impression that only large claims affect their premium. While that’s true, frequency of claims (even those small in nature) can reflect poorly on your company and increase overall premiums. The insurance carrier takes both frequency and severity (total cost of a claim paid) into account when reviewing a risk for eligibility and calculating overall annual premiums.
2. Experience Modification Rating
Your Experience Modification Rating is compiled from significant data (class codes, payroll, expected vs. incurred claims, premium, etc.) that directly relates to your WC costs. The WC bureau(s) will utilize this rating to determine whether your staffing company is eligible to receive a credit or debit on its current WC policy. It’s calculated annually and depends on the frequency and severity of your claims based on the look back period. The industry standard is 1.00, so anything above that would warrant a debit and anything below that would warrant a credit. By minimizing the occurrence and cost of the claims filed, you can also eliminate additional premium being charged to your WC policy.
3. Safety Programs
It’s important for every staffing business to have a written safety program in place. This is an important tool that helps empower your employees to understand the proper safety protocols and processes that should be followed so they can avoid injury. By consistently incorporating safety policies and procedures and sharing these safety tips with your employees, you’ll help them to be more aware of exposures and how to promote safety in their work environment.
4. Safety Trainings
Implementing safety trainings into your company’s culture will not only keep your employees educated, but will also promote safety and encourage employees to have that mindset while doing their job.
- Register for Back to Basics: Workers’ Compensation Seminar (7/30)
- Register for Deep Dive: Workers’ Compensation Seminar (8/6)
- Register for Bottom Line Impact: Workers’ Compensation Seminar (9/16)
- Watch How to Create a Safety Culture Webinar
- Watch Effective Claims Management Webinar
ABOUT THE AUTHOR