Workers Comp Costs Often Unrecognized During Tough Economic Times

While many companies continue to battle with added costs and continuing layoffs, the financial impact of ever-increasing workers’ compensation insurance costs often goes unrecognized.

For many companies, getting a handle on workers’ comp costs is something that is absolutely possible, but it takes time and effort to do so.

Whether companies are major players in the business world or mid-level employers, their workers’ comp costs can be managed, with the average reduction being anywhere from 20 to 50 percent.

For those not comfortable in dealing with their workers’ comp costs, finding a qualified insurance broker or agent to explain the methodology of premiums and more is easier than you think. At the end of the day, all workers’ comp coverage will be decided by how much in losses the insurer believes your company will undertake.

For the majority of companies, workers’ comp ranks as the greatest percentage of their insurance dollar; often as high as 30%, according to the 2009 RIMS^® Benchmark Survey. For Professional Employee Organizations (PEO), and trucking companies, workers’ comp cost is many times trailing only their payroll expense. (workersxzcompxzkit)

Employers, insurers and brokers that team together have major incentives to trim the cost of workers’ comp.

When starting such an initiative, the risk manager needs to obtain the support of senior management, employees and physicians to put in place a holistic program. The broker must obtain the numbers to substantiate development of cost containment initiatives.

Editor’s Note: Look for how to implement a proven workers’ comp program in the next installment.

Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-786-8286.

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workman’s comp issues.