As an enterprise leader, you own a business that is run by your employees, whether part-time or full-time. When it comes to work-related illnesses and injuries, your business can be held liable, which is a risk that you can transfer to a workers’ compensation insurance carrier. However, if you have noticed that your workers’ compensation insurance premium has increased on your last renewal, there are a few reasons that explain why.
The Increase of Workers Compensations’ Premium
The reasons for the increase in these premiums are many. For example, if you added more personnel, the reason behind it is the payroll increase. Payroll is the main element upon which workers’ compensation premiums are based.
Other reasons include the increase in the number of work-related injuries. These injuries lead to an increase in claims on the workers’ compensation insurance. When your insurance carrier sees an increased number of claims against insurance, they will try to reduce those losses to their profit. If a staff member was severely injured at work, is away from work for an extended period, needs to receive therapy, or has had surgery – all of that costs the insurance company money.
The insurance company must maintain a reserve to be able to pay for future medical treatment, surgery, wages, etc.
How to Stop the Increase in Insurance Premiums
The more you use it, the more it costs, just like any other insurance. Generally, workers’ compensation insurance will increase, so the goal is to reduce that number of increases as much as possible for the enterprise. To achieve that, the company needs to reduce the number of claims against the insurance by reducing the seriousness and number of injuries that personnel experience at work.
Having a sound safety management system or safety program is the most effective way to reduce the number of claims. Executives needs to support the effort to reduce the number of injuries on the job. Next, you need to encourage your staff to participate in efforts to reduce injuries by making suggestions and reporting injuries, incidents, and hazards. Have someone conduct inspections and audits to identify hazards that can potentially injure your staff members. They should document them and make suggestions on how to eliminate or control those hazards.
To determine what caused workers to get injured, you should go through past injury reports to find the causes and control them as well. To address the hazards that are not possible to control or eliminate, the company should develop safety procedures and train the personnel on them. Reducing injuries in the workplace is not a quick process, and it is never really complete. Ultimately, it should lead to a change in company culture, attitudes, and behaviors.
Another crucial thing a company can do to minimize the impact of claims on the premium is to bring personnel back to work as soon as possible. In Canada, medical providers have less control over when their injured personnel will return to work. Also, their primary compensation cost drivers are wage-loss benefits and loss of earnings rather than medical benefits (because of the publicly-funded health care system). The insurance for workplace illnesses and injuries is provided by the Workers’ Compensation Boards (WCBs), which are funded by employers (not the government) and operate independently.
The Checker provides inspection books that can help organizations perform safety audits and inspections to eliminate or control workplace hazards. By reducing illnesses and injuries, you will be able to keep the workers’ compensation increase to the minimum.