Workers compensation insurance is a critical component of any company’s coverage. This protects a business when an employee is injured on the job. For most corporations, this policy represents a significant cost. On top of that, premiums have been steadily rising across the industry. For these reasons it is essential for a business to explore all options in the marketplace when it comes to workers comp.
Advantages Compared to Traditional Structure
In the traditional format, premium payments are typically paid upfront based on an estimate of annual payroll and other factors. There is an alternative offering that enables you to pay throughout the year. The protection it provides does not differ from the traditional method. The insurance firm insuremyworkcomp.com states that this comp as you go structure can free up cash flow for a company by not having to pay a lump sum upfront. There are several reasons the pay as you go format can be beneficial:
- Payments are based on actual headcount at each payroll period.
- No single large amount to be paid each year.
- Avoid premium modifications and audit surprises.
Workers compensation insurance is an unavoidable yet necessary protection against potential risk. There may be benefits to utilizing a different payment structure for premiums than the traditional methods.