Workers comp is a significant expense for most businesses — but many companies are overpaying without knowing it. Here are seven proven ways to reduce your workers comp premium without cutting corners on coverage.
1. Make Sure Your Employees Are Classified Correctly
Class code misclassification is the most common reason businesses overpay for workers comp. If an office employee is accidentally classified under a field labor code, you’re paying the higher rate on their entire payroll. Have an experienced agent review your classifications before every renewal.
2. Separate Office Payroll from Field Payroll
If you have employees who work in an office or shop, make sure their payroll is reported under the appropriate lower-risk class code. Don’t lump everyone under the highest rate.
3. Maintain a Clean Claims History
Your experience modifier (EMR) is driven by your claims history. Fewer claims mean a lower mod and a lower premium. Invest in safety training and document everything.
4. Report Payroll Accurately
Accurate payroll reporting keeps your cash flow predictable and avoids large audit bills at year end.
5. Collect Certificates of Insurance from All Subcontractors
Any sub you hire without a current COI risks having their payroll added to your policy at audit. Require COIs before work begins and keep them on file.
6. Shop Multiple Carriers Every Year
An independent agent shops the entire market at renewal — not just one carrier — to find you the best available rate.
7. Work with a Workers Comp Specialist
Comp Matters Inc. focuses exclusively on workers comp for East Coast businesses. Call (631) 248-2500 for a free review.
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