Workers compensation insurance is a type of business insurance that is a requirement for businesses in most US states. Unfortunately, the costs to acquire this coverage can be high, especially for small businesses with tight budgets. However, that doesn’t mean that businesses don’t have some control over how much they pay for it. Businesses that desire to cut the costs associated with carrying workers compensation insurance should investigate several areas of their coverage to determine where cuts can reasonably and legally be made.

Switch from an Assigned Risk Plan

The first step that businesses should take is to read their current workers compensation policy carefully to determine if they are on an assigned risk plan. Small businesses are often on these plans, and the costs for them can be higher than with other types of plans. If a business determines that they are on an assigned risk plan, they should attempt to cancel the policy and obtain one that is classified as voluntary. Your insurance agent can assist with this process.  

Use State Credits

Many states offer credits to businesses that prove they are a reduced liability for workers compensation claims. One of these credits is for workplaces that are certified to be drug- and alcohol-free. Other credits that are available include a small deductible credit and merit rating credits.

Have an Audit

Many insurance companies will require an onsite audit before they will finalize a workers compensation policy for a business. If this is the case, businesses should obtain copies of all documentation and paperwork created during the audit. This allows you to ensure that payroll and risk audit information match, especially for workers who are part-time or contactors.

Other Discounts

Finally, many professional trade organizations offer business insurance for their members including workers compensation insurance. Many of these plans are offered at reduced rates due to the large number of companies and individuals enrolled in them. Businesses should obtain workers compensation insurance quotes from as many places as possible to ensure that they are getting the lowest cost and the best coverage.