Here at the Don Neeley Agency, we work with lots of local businesses to reign in business insurance premiums, including workers’ compensation. Sometimes, premiums even decline across the board. You can largely credit these lower prices to improved worker safety. Do you know how to reduce your company’s premiums and get the best value for workers’ compensation?
Reducing Arizona Workers Compensation Prices
The premium rate will largely depend upon the type of business and the kind of employees. Compared to other states, Arizona rates have remained relatively low. The state often credits these relatively low premiums to the many local businesses that do a good job protecting workers. Safety programs that include training, an emphasis on safety first, and risk evaluations do help lessen the risk of on-the-job accidents and injuries.
Of course, businesses will also benefit in other ways by any investment they make in safety. Healthier employees can work more productively. Safety programs also tend to reduce turnover and improve morale. In any case, a number of studies on the issue have found that investments in safety tend to generate returns as high as 200 to 600 percent. Companies may earn these returns because of higher productivity and morale, less turnover and time off, and of course, lower workers compensation premiums.
How Safety Programs Can Reduce Workers Comp Premiums
All workers’ comp companies use a standard formula to calculate a company’s premium. At first, they consider the kind of business, the type of employees, and the size of the company. For example:
- Certain types of manufacturing and construction companies have traditionally been assigned a higher rate because they’re considered riskier.
- It’s important for businesses to ensure that they have their business correctly classified.
It’s even important to drill down and ensure that employees within the business have the right job codes. Even in the riskiest types of businesses, some employees may not take those risks and should get a lower rate. Some companies may get overcharged because the overall business or individual employees have not been correctly classified.
After the insurer figures out a standard rate for business, they multiply this premium times a decimal figure that’s called a modifier. This modifier gets adjusted a lot by the past claims history of the specific business. At the same time, such factors as risk evaluation and remediation and documented safety programs can also adjust premiums in the businesses favor.
Even if your business has suffered from a high number of workers comp claims in the past, you can certainly strive to improve your safety record and the way that insurance companies view your business environment. Instead of viewing your insurance company as an adversary, it’s important to find a workers comp company that you can work with as a partner.
We Will Partner With Your Business to Reduce Safety Risks and Premiums
Here at the Don Neeley Agency, we want to work with you to reduce your business insurance premiums. We can work with your company and your insurer to evaluate and remediate the types of hazards that can lead to safety issues and higher premiums. Besides that, our independent agency works with multiple carriers, so we can find the ones that are most competitive for your kind of company. To work with us to manage business insurance and safety risks in and around Scottsdale, contact us today.
