If you have employees, you usually have to carry workers’ compensation insurance. Because workers’ compensation is a required cost of doing business, it’s easy to become complacent about the cost. That’s a mistake. Yes, you need workers’ compensation insurance, but you don’t need to overpay, and workers’ compensation premium complacency can be costly.
A Solution for Your Company’s Budgetary Problems
A workers’ compensation premium audit may be the solution to your company’s problems. It may even be the solution to problems you don’t realize you have. Every company needs to find ways to cut costs while boosting profits, and workers’ compensation is often overlooked in these efforts.
Here are three situations in which a workers’ compensation premium audit could help your company.
Situation One: Workers’ Compensation Is Taking an Oversized Bite out of Your Budget
Problem: You want to improve your company’s profit margins. Boosting revenue is one option, but cutting overhead costs could be another solution.
Solution: Slashing your workers’ compensation premiums is a good way to get some breathing room in your budget.
Real-Life Example: A retail marketing chain was paying a lot for workers’ compensation, and they thought they might be overpaying. They signed up for CRC’s services, and within a few months, we were already processing a six-figure premium recovery for them. The recovery amounted to about 6% of their annual premium, and the premium review was still ongoing.
Situation Two: You’ve Been Rated Incorrectly for Years
Problem: Policyholders don’t get to choose their workers’ compensation rates, and neither do the insurance brokers. Rates are calculated based on your payroll, the type of work and your claims history. This should result in fair premiums, but errors in the calculations can lead to overpayments. If you’ve been rated incorrectly, you could overpay year after year, and even small errors can add up to large sums of money over time. This is bad for the business owner, but it’s also bad for the broker who’s trying to maintain a positive relationship.
Solution: A workers’ compensation premium audit can uncover errors and recover overpayments.
Real-Life Example: A marina had been rated incorrectly with years. CRC worked with the broker to have the rates corrected and to return nearly 50% of a year’s premium. It’s not just a one-time savings, either. Thanks to CRC’s intervention, the marina owner will enjoy lower premiums for years to come. This one decision to take a closer look at premiums could result in a seven-figure savings over the course of the next few years.
Situation Three: The Carrier Has Denied Your Request for Revisions
Problem: You disagree with the worker classification your carrier has applied to your rates. As a result, you think you’re paying more than you should for coverage. You’ve requested a revision, but your carrier hasn’t provided one.
Solution: Even if you suspect that you’ve been rated incorrectly, you might not be able to get the insurance carrier to revise the rating, at least not on your own. You may need the help of an expert in workers’ compensation premium audits and overpayment recoveries.
Real-Life Example: A contractor had been rated incorrectly for years, but the carrier denied the request for revisions. The situation was at a standstill – until the contractor got CRC involved. We informed the carrier of the policy of the state workers’ compensation bureau in regard to this specific situation. We also provided the right audit papers to reclassify the entire workforce. Premium recoveries associated with reducing the contractor’s premiums by nearly 50% are now underway. On top of the recovery, the company will also pay lower premiums going forward.
How Could Your Company Reallocate Funds?
Whether you’re running a for-profit business or a non-profit organization, you need to think about your bottom line. If could recover workers’ compensation premium overpayments, how would you reallocate the funds? Could you invest in new initiatives to further your organization’s goals? Could you invest in better technology? Could you hire more workers? The possibilities are endless.
Complacency may be costing your company thousands upon thousands of dollars, but recovering your workers’ compensation premium overpayments doesn’t have to eat up your time or resources. CRC works on a contingency fee basis, so if there’s no recovery, there’s no cost. We also do most of the work in our own offices, so we don’t take up much of your time. Contact us to get started.
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