Workers’ compensation insurance is an essential part of any business—it’s legally required in most states and it’s crucial for keeping your workers protected. Whether you have one employee or one hundred, ensuring that they’re covered in the event of an accident is imperative. Workers’ comp coverage can help with medical expenses, rehabilitation costs, and lost wages during the recovery process.
Not only does workers’ compensation help protect employees who get injured at work or become ill as a direct result of the job, but it also helps protect you and your business. Without workers’ compensation, if an accident happens, you could be required to pay out-of-pocket for what would otherwise be covered by insurance.
Workers’ comp is a necessity for your company, but it can also be costly. One cost management strategy for workers’ compensation is to partner with a professional employer organization (PEO) for your coverage. Let’s take a look at how PEOs help manage workers’ compensation expenses and cost-reduction strategies with PEO partnerships.
How PEOs Help Manage Workers’ Comp Expenses
When you partner with a PEO, that PEO and your company enter into a co-employment relationship. The PEO steps in to take care of administrative tasks like payroll, workers’ compensation, and risk management while you continue to focus on the day-to-day operations of your business.
When it comes to workers’ compensation insurance, each company the PEO works with is grouped together in one large pool of employees. This means the PEO is able to secure fantastic coverage at a more affordable rate than what you would normally see. The more employees the PEO partners with, the lower your premium cost will be.
Working with a PEO also means you may be able to avoid paying large lump sum deposits upfront. The PEO will handle these costs, and you’ll pay the PEO over time.
Cost-Reduction Strategies with PEO Partnerships
There are several cost-reduction strategies that come with PEO partnerships—from educating employees on workplace safety to offering pay-as-you-go insurance programs.
First and foremost, PEOs aim to create safe working conditions for their client companies. Risk management is a large part of what PEOs bring to the table as a co-employer. They create and implement safety training programs for new and existing employees to help educate them on workplace safety. PEOs also specialize in compliance with state and federal regulations, so they know what’s needed in order to keep your company up-to-par with current labor and safety laws.
Creating a safe work environment is crucial for reducing workers’ compensation claims. By keeping the number of claims at a minimum, premium costs will also remain low.
Beyond claim reduction, PEOs offer pay-as-you-go programs that are great for small or medium-sized businesses with contract-based workers. While traditional workers’ compensation may make sense for larger corporations, having fewer employees or employees that work on a project-by-project basis tends to require a more customized approach.
With a pay-as-you-go program, you only pay for what you need when you need it. As the employer, you can choose the exact coverage that fits best for your industry and the category of workers you have. You can also choose the duration of time your employees will have coverage so that you aren’t paying for unnecessary insurance between projects.
PEOs also administer payroll, so you won’t need to worry about surprise costs when audit season arrives. When you have the expertise of a PEO on your side, you can rest assured that the most cost-effective strategies will be put in place when it comes to workers’ compensation for your company.
Maximizing Savings in Workers’ Comp with PEOs
Partnering with a PEO can offer incredible cost management strategies for keeping your employees protected with workers’ compensation insurance. If you’re ready to reduce your workers’ comp costs and ensure that your employees have the best protection possible, partnering with a PEO could be a great option for your company. Reach out to the team of experts at PEOPayGo to help maximize your savings in workers’ compensation.
