Reduce Your Overhead Costs By Self-Insuring
As you review your business overhead costs, you will notice several areas where you can save for higher profitability. When you are cutting costs, it is important to assess the risks that may arise because of the changes you are making in your business plan. One area some risk management team members review is workers' compensation insurance. While most states require businesses to carry some form of workers' compensation insurance, businesses can get around these requirements by choosing to self-insure. When you self-insure your business against workers' compensation claims, you will need to invest in an excess workers compensation policy. Understand how to self-insure your business and how excess insurance will protect you in the event of a catastrophic loss.
Businesses Should Only Consider Self-Insurance if They Can Control Losses
Before you even consider the option of self-insuring your business, you must have an effective accident prevention program in place. One of the main purposes of self-insuring your business against worker's compensation losses is taking advantage of the opportunity to save money on work comp premiums and audits. If you do not have an accident prevention program in place, you may end up dedicating more of your resources to unnecessary claims. Make sure risk managers and business executives sit down together to implement a successful program that will keep employees safe and healthy. When you know your program is working you can move on to setting aside resources for self-insurance.
Types of Excess Insurance
As you are planning your self-insurance program, you will need to review several different excess workers compensation insurance policies. When you are requesting quotes, the indemnity insurer will ask how much liability you want to take on in terms of claims. This is the amount of money you will be required to pay before the insurer will pay out. You may also set a dollar limit on how much the insurer will pay total for catastrophic losses. If you do not want to set a cap, you will need to find an insurer offering unlimited excess protection.
Choosing the Right Excess Insurer
Once you have obtained quotes from several different insurers you will need to do your homework. Consider more than just price when you are shopping for excess work comp insurance. Consider the company's financial rating, customer service satisfaction ratings, claims processing procedures, and professionalism. Excess insurers take on a huge amount of risk. You need to make sure the risk you are assigning to a company will be paid out in the event of a claim.
Self-insuring your business against employee injury claims is one way you can reduce overhead costs. When you choose this option, make sure you plan ahead and set aside the proper resources to cover claims. With the right type of excess workers compensation plan, you will have peace of mind while still saving money.
Businesses Should Only Consider Self-Insurance if They Can Control Losses
Before you even consider the option of self-insuring your business, you must have an effective accident prevention program in place. One of the main purposes of self-insuring your business against worker's compensation losses is taking advantage of the opportunity to save money on work comp premiums and audits. If you do not have an accident prevention program in place, you may end up dedicating more of your resources to unnecessary claims. Make sure risk managers and business executives sit down together to implement a successful program that will keep employees safe and healthy. When you know your program is working you can move on to setting aside resources for self-insurance.
Types of Excess Insurance
As you are planning your self-insurance program, you will need to review several different excess workers compensation insurance policies. When you are requesting quotes, the indemnity insurer will ask how much liability you want to take on in terms of claims. This is the amount of money you will be required to pay before the insurer will pay out. You may also set a dollar limit on how much the insurer will pay total for catastrophic losses. If you do not want to set a cap, you will need to find an insurer offering unlimited excess protection.
Choosing the Right Excess Insurer
Once you have obtained quotes from several different insurers you will need to do your homework. Consider more than just price when you are shopping for excess work comp insurance. Consider the company's financial rating, customer service satisfaction ratings, claims processing procedures, and professionalism. Excess insurers take on a huge amount of risk. You need to make sure the risk you are assigning to a company will be paid out in the event of a claim.
Self-insuring your business against employee injury claims is one way you can reduce overhead costs. When you choose this option, make sure you plan ahead and set aside the proper resources to cover claims. With the right type of excess workers compensation plan, you will have peace of mind while still saving money.