Kentucky Workers Compensation Rates are Declining by 10.8 % in 2019

The Business Community in Kentucky Will be benefiting from improved Workers Compensation Rates in 2019

In Kentucky, the business community will pay significantly less for Workers Compensation Premium next year. The rates will actually be 10.8 percent less in 2019. The decline in premium will apply predominantly to the industries of manufacturing, office, clerical, and contracting. These means some industries will see less of a decrease and some industries may see no decline at all. No matter what industry a business operates in, the business community overall will benefit from better Kentucky Workers Compensation Rates 2019.

Kentucky Bluegrass on a Horse Farm.

Why are Kentucky Workers Compensation Rates Declining in 2019

There are a number of reasons why Kentucky Workers Compensation Rates in 2019 will be declining by more than 10 percent. Some reasons contributing to the decline in premium throughout Kentucky is stability in written premium, lower combined ratios throughout the state, and lower loss-time claim frequency. This means the number of businesses buying workers comp coverage is the same or increasing compared to the previous years. The experience modification ratings of the businesses operating in the state are lower. This low rating comes from businesses operating safely and filing less claims. The lower loss-time claim frequency means workers who have been injured have been able to get back on the job fairly quickly, lowering the amount the workers compensation system has had to pay out for claims.

Additionally, the strongest factor contributing to declining workers comp premium rates is House Bill 2. According to the Department of Insurance Commissioner Nancy Atkin, “much of the decrease in costs to the passage of House Bill 2, which made significant reforms to the workers’ compensation system for the first time in over twenty years”. Many of the statutes in the previous workers compensation system were ruled unconstitutional by the state supreme court. These rulings brought about instability throughout the workers compensation market in the state. House Bill 2 stabilized that market.

Bourbon Barrels holding Kentucky Straight Bourbon Whiskey

Kentucky Workers Compensation System Over Haul

House Bill 2 passed in 2018. This was the first attempt to make significant changes to the workers compensation system in the state of Kentucky in more than 20 years. Jeffrey Junkas, assistant vice president, state government relations for PCI said, “House Bill 2 is designed to help contain underlying costs and improve the state’s workers compensation system. HB 2 makes changes impacting medical expenses and benefits. It also takes steps to address the opioid crisis with an evidence-based pharmaceutical formulary and medical treatment guidelines to ensure timely delivery of appropriate medical care to injured workers.”

In addition, the bill increases the maximum compensation rates for employee temporary total disability, permanent total disability, and permanent partial disability benefits. It improves access to vocational rehabilitation services, and makes improvements in the dispute resolution system. These changes will improve efficiency of the system and provide better services to both businesses and injured workers.

One big difference to the system that was brought on during the overhaul in 2018 was a 15-year benefit cap from the date of injury. This cap would apply only to workers who meet certain conditions and are filing claims for permanent, partial disability because of on-the-job injuries. Many of these workers eventually return to the labor force and do not collect the full 15 years worth of benefits. Currently, they are entitled to medical benefits for the duration of the disability. This could be for the rest of their life in some situations. House Bill 2 does allow injured workers who meet these conditions to file for recertification. If they are approved the new system would allow them to continue receiving medical benefits.

Kentucky Fried Chicken

What Can Kentucky Business Owners do to Maximize Savings?

Depending upon the class code and the experience modification rating of an individual business the rating may be larger or smaller than the average decrease. There are a number of things a business can do to control what they pay for workers compensation insurance premium.

Safety Programs

Safety Programs are the single most effective way to limit what a business pays for commercial insurance. Separate from what it does for the businesses bottom-line, it is simply the right thing to do. Taking care of the health and well-being of your employees and customers should be at the heart of any businesses mission. Taking care of your staff will allow them to be more productive while also lowering the frequency and severity of insurance claims made by the business.

Light Duty Work

The best way to get employees back on the job and back to full-time work is to have light duty work prepared for those employees. Humans are creatures of habit and our work day routine is a big part of our most employees routine. The longer an injured worker stays off the job, the longer they have to create new habits away from the job. Having a plan for many types of light duty work in order to get injured workers back on the job and back in to their workday routine.

Classify Properly

In order to maximize savings when it comes to all forms of commercial insurance, it is important to first make sure all employees are classified properly. Many businesses have employees who partake in drastically different areas of the business. Some of those businesses have employees who work in office or clerical work, other employees who are salesman who spend a lot of time out at third party locations, and still other employees who work doing physical labor. All of these employees need to be placed in the proper classification code and their payroll needs to be strictly measured.

Shop Around Your Policy

In order to maximize savings, it is important to shop around your policy periodically. It is not a good idea to switch carriers each year based upon a small decline in premium. Long term relationships still do mean something when you have to file a claim. At the same time, it is important to make sure your carrier is competitive with the market.

Use an Independent Agent

Shopping around your insurance policy can be a time consuming endeavor. If your time is valuable, partnering with an independent insurance agent can be a way to get multiple quotes from multiple carriers all in one place. Partnering with an independent agent can allow you to get back to running your business while the insurance agent shops your policy so you don’t have to. This can maximize savings while getting your business more comprehensive coverage.

Connecticut Workers Compensation Rates are Going Down in 2019

17% Decrease for Workers Comp Rates in Connecticut

Connecticut Workers Compensation Rates will be declining in 2019 by an average rate of 17 percent. Marking the fifth straight year rates have declined throughout the state of Connecticut. Over the past five years rates have declined by an average of 3, 4, 11, and 14 percent. Altogether, these decreases amount to the Connecticut Business Community paying 50 percent less than five years ago. According to Katharine L. Wade, the Connecticut Insurance Commissioner, “This steady drop – nearly 50 percent over the last five years – has helped business owners with one of their critical operating costs – workers’ compensation insurance.”

Rustic Barn in the Scenic Connecticut Countryside

What Contributed to Declining Connecticut Workers Comp Rates

A number of factors have contributed to the significant decline in Workers Comp Rates. In relation to the reasons for the decline Wade said, “The rates reflect an ongoing decrease in the number of workplace injuries and claims filed. We are also seeing, on average, lower medical costs per claim.” The decrease in workplace injuries is predominantly related to business owners throughout the state of Connecticut paying more attention to workplace safety. The state is also seeing lower medical costs per claim.

Additionally, a consistent decline in claim frequency since 2010 and per case indemnity costs continue a slow but consistent decline, from $31,611 in 2013 to $29,193 in 2016. An indemnity claim protects an employee against damages. The Workers Comp Policy offers medical coverage, lost-wage replacement, permanent disability benefits, vocational rehabilitation, and even death benefits for family members. Within the insurance industry, professionals categorize claims into two classes: indemnity and medical-only. An indemnity claim occurs when an employee becomes injured on the job and cannot return to work until the injury heals or the injury becomes permanent. A medical-only claim applies when the employee immediately returns to work after the injury.

USB Building in Stamford, Connecticut

What is Unique about the Workers Compensation System in Connecticut?

Connecticut was one of the first states to enact Workers Compensation Legislation in 1913 with the Workers’ Compensation Act (also known as Chapter 568 of the Connecticut General Statutes). The primary purpose of the Act has always been to provide wage replacement and medical treatment for employees who have been injured, disabled, or killed while on the job. While the state of Connecticut was an early adopter of the workers compensation system, this was a time period when many states began to adopt some form of workers compensation system throughout the first few decades of the twentieth century. With the onset of the industrial revolution, states realized that there was a need for a strong workforce. One way states went about guaranteeing there would always be a strong and healthy workforce in their state was to develop some form of a workers compensation system. Just five years ago in 2013, the state of Connecticut celebrated 100 years of such a system.

The basic structure of the original law still survives despite four major revisions and numerous smaller modifications. Connecticut is a No Fault State meaning the workers compensaiton system provides benefits to employees no matter who was at fault for the injury or illness. Within the state of Connecticut injured employees are provided medical treatment, wage replacement, vocational rehabilitation, jon retraining, dependents death benefits, and relapse benefits.

Picture of the state map of Connecticut with the word Connecticut written in cursive.

What can Business do to Maximize Declines in Connecticut Workers Compensation Rates?

Implement a Safety Program

A Safety Program is the single most effective way to limit the frequency and severity of insurance claims within a business. Limiting claims can have a long term positive impact to your business when it comes to purchasing commercial insurance. This is because it will have a positive impact on the businesses experience modification rating, which is one of the most impactful measurements underwriters use when they decide if they are going to offer your business coverage and how much to charge for that coverage.

Include a Return to Work Program

Incorporating a return to work program into your safety program is a great way to positively impact your experience modification rating for years to come. This is because the quicker an injured employee returns to work, the more likely they are to return to permanent work. This is how a business can limit the damage to the business when it does experience an injured worker.

Shop Around Your Policy

Shopping around your policy is something you should do periodically. If not every year, at least every few years in order to make sure your current insurance carrier is competitive with the current market. It is not a wise decision to switch each year based upon a modest decrease in premium, but it is wise to keep your rate competitive.

Partner with an Independent Agent

One of the best ways to shop around your insurance policies is to partner with an independent insurance agent. An independent agent can shop around your policy for you and they have the inside knowledge to know which carriers are hungry to quote your industry or the coverages you are looking for. This can save you time and money when purchasing commercial insurance.

17.2% Decrease for North Carolina Workers Compensation Rates 2019

North Carolina Workers Comp Rates will be declining in 2019

In 2019, businesses in the state of North Carolina will pay on average 17.2 percent less for workers compensation. This decrease is in addition to a 8.5% decrease in 2016 and a 12.5% decrease in 2017. This is great news for North Carolina. In 2018, North Carolina ranked near the middle of the national average. A 2018 study ranks NC as the 23 highest in premium rates across the United States making their average rates 4% higher than the national average. A similar study done in 2016 ranked the state as 27th for average rates. North Carolina’s median rates are currently on par with the average rates in the U.S. This decrease should lower the states ranking and considering North Carolina is the 10th most populous state, this is great news for the business community.

Why are North Carolina Workers Compensation Insurance Rates Declining in 2019

North Carolina Workers Compensation Rates 2019 are decreasing primarily as a result of insurance carriers processing fewer claims and paying out less for workers’ compensation claims. Because of these declines in claims and payouts, the carriers are able to pass on the savings to customers. Now not all industries are going to see the same amount of decrease. Some industries may fair better than others. According to the North Carolina Rating Bureau (NCRB), manufacturing industry groups will experience an average drop of 15.8 percent, contracting industry groups will see a decrease of 6.5 percent, and both office and clerical as well as goods and services will see an average of 19.3 percent decrease to both industries.

Requirements for Workers Comp Coverage in North Carolina?

In the state of North Carolina employers with three or more regular, full, or part-time employees are required to secure workers comp coverage. This includes all corporations and non-profits. Sole Proprietors, Partners, and LLC Members are automatically excluded from coverage, but have the ability to elect coverage. Corporate officers are included on all policies, but can exclude themselves using the Accord 130 form.

Payroll Requirements for Business Owners in North Carolina

Sole Proprietors and Partners who include themselves on coverage must use an annual payroll of $46,900 for rating purposes as of 04/01/2019. Corporate Officers who do not exclude themselves from coverage must do so at a minimum payroll of $46,800 and a maximum annual payroll of $93,600 as of 01/01/2019.

What is Unique about the Workers Comp System in North Carolina?

Experience Modification Rating

The Workers Compensation System in the state of North Carolina is unique because the state calculates the Experience Modification Rating of business on its own. The department that does this is the North Carolina Rate Bureau (NCRB). Most states partner with the National Council on Compensation Insurance (NCCI) to establish these ratings. North Carolina does report claims to NCCI for the purpose of determining interstate modifiers. This applies to employers who operate in North Carolina and other states throughout the country.

Waiver of Subrogation

Waivers of Subrogation are no longer required in North Carolina. They are not required because North Carolina Law establishes that a principal contractor is not responsible for subcontractors. This may cause contractors to face unique challenges throughout the state. Regardless, general contractors may be liable for injuries and coverage of uninsured subcontractors. In some instances, a general contactor may charge subcontractor for the cost of workers compensation while working on various jobsites.

The North Carolina Business Community will be seeing improvements next year in the form of lower workers compensation rates. This good news resulted from insurance carriers processing fewer claims and paying out less for the claims that were processed. These improvements are attributed to technology improving the efficiency in improvements and the safety of the workforce. In light of these savings, business owners should consult with their insurance agent to make sure they are maximizing all possible savings when it comes to workers compensation as well as all other forms of commercial insurance. Partnering with an independent agent is the most efficient way to ensure comprehensive coverage at the lowest rate possible.

How can Businesses Ensure Maximum Savings on North Carolina Workers Compensation Rates 2019

Partner with an Independent Agent

Partnering with an Independent Agent is one of the best ways a business can make sure to get maximum coverage at rock-bottom rates. This is a fact because an independent agent is not pressured to sell you the coverage of one insurance carrier. An independent agent can shop your policy out to multiple carriers. Multiple carriers competing for your business can get your business better coverage at better rates. Additionally, the independent agent knows which carriers are hungry to quote the policies you are looking for, in the particular state you are located, and in the industry your business operates. This inside knowledge can save you time and money when looking for coverage.

Control Your Experience Modification Rating

The experience modification rating of a business is crucial to limiting what the business pays for premium. The first thing an underwriter looks at when determining if they are going to offer coverage to a business and what to charge that business for coverage, is the classification code of the business and the experience modification rating of that business. Controlling this rating is one of the more impactful aspect a business has control over. Especially related to what the business pays for commercial insurance, especially workers compensation.

Prepare for Natural Disasters

In North Carolina, Natural Disasters are a risk to consider. This is the case no matter what part of the state you are located. Hurricanes and flooding are especially important to speak with your insurance agent about. The amount of risk you are comfortable with may not be the same as other business owners. If this is the case, it is important to express this to your agent. Tell them what you do, what the climate is like, and the level of risk you’re comfortable. With this knowledge, a good independent agent should be able to find several packages to suit your needs.

Develop an In-depth Safety Program

Safety Programs are one of the most cost effective ways for a business to save money. Not only can an effective safety program help a business save on commercial insurance, it can also help save money in many other ways. Lowering damage to equipment, less missed days by injured employees, and a happier workforce are at the top of the list of ways a business can benefit from an effective safety program.

Include a Return-to-Work Program

A Return-to-Work Program is something that can be implemented in tandem with a safety program and save your business immensely when you do experience an injured worker. Statistics show, the quicker an employee gets back to work, the more likely they are to return to work. This will save your business considerably by not damaging your experience modification rating, by not having to deal with a missing or injured employee, and by not having to retrain a new employee to do what the injured employee had experience with.

Exclude Owners

An Owner Exclusion in North Carolina is generally permitted for a business to exclude themselves from workers’ compensation insurance. This is true for every form of business. That includes sole-proprietors, partners, LLC owners, and corporations. Owners who decide to exclude coverage on themselves are not covered in the event they are injured on the job. If the business is willing to take on the risk, excluding the owners from coverage can save each year on workers compensation premium.

Ask about Credits and Discounts

North Carolina law allows insurance carriers to apply scheduled credits up to 25% of the full premium on each individual workers compensation insurance policy. This is in addition to credits already given to the policy holder.Credits are typically given because of a good Experience Modification Rate. Credits are usually given for management experience, no prior claims, and profitability of an account. Employers should always take additional time to speak long and honestly with their insurance agent to inform them about every positive the business has to offer. It is equally important to request additional credits when shopping workers compensation quotes.

Florida Workers Comp Rates Remain in Flux for 2019

Florida Workers Comp Rates 2019 are headed in a positive direction.

In 2019, Florida Workers Comp Rates are improving for the business community throughout the state. The decline amounts to a deduction of 13.9% and will contribute to a savings for business in Florida of approximately $454 million. This is good news because the Florida Workers Compensation System has been in flux for a number of years. This decrease is the third such decrease over the previous year and a half. Previous to these three decreases, the workers compensation rates had increased by 14.5% in 2016.

Florida Workers Comp Insurance Rates 2019

What Caused Florida Workers Compensation Rates 2019 to Decrease?

Florida Workers Comp Rates 2019 are decreasing because of significant improvements in experienced losses by insurance carriers. This means the insurance carriers paid out less in claims. Some within the industry credit safer workplaces, enhanced efficiencies in the workplace, and an increase in the use of technologies for the decrease in costs.

What is Unique about the Florida Workers Compensation System?

The most unique aspect of the Florida Workers Compensation System is that Florida is a No Competition State. This means Florida is one of the few remaining states in the country where every insurance company offering coverage within the state are required to offer the same rates and discounts as all other carriers. State mandated rates mean employers do not have to shop around as much as more competitive states. Business primarily need to be concerned about finding an insurance carrier willing to offer coverage on the voluntary market with the most cash flow friendly payment options and the business needs to avoid the Florida State Fund.

Pond with a waterfall and palm trees in the background at a Miami, Florida Golf Course.

Why have the Workers Comp Florida Rates 2019 Been in Flux?

For the past few years, workers compensation rates within the state of Florida have been in flux for a number of reasons. Two State Supreme Court Decisions have contributed to the instability. Those cases were Castellanos v. Next Door Company and Westphal v. City of St. Petersburg. Castellanos vs. Next Door Company made a previous 2009 ruling invalid, meaning judges no longer had to stick to the mandatory fee schedule and now can award additional compensation for attorney’s fees when offering judgments within the workers compensation system. The Westphal Case, had a ruling that ruled the 104-week statutory limitation on temporary total disability benefits is unconstitutional. This ruling extended this period to a 260-week limitation. This 260-week limit is more in line with states throughout the country and significantly increased the amount carriers had to pay for permanently disabled injured workers.

Another factor that has caused the workers compensation system in the state of Florida to be out of whack is State Senate Bill 1402. This bill accounted for 1.8% of the recent increase in premium by increasing the cost for updates within the Florida Workers’ Compensation HCPR Manual.

In addition to these issues, in 2017 the Florida Insurance Regulators took over Guarantee Insurance Company (The states assigned risk workers comp provider) because it had become insolvent. This left 1250 businesses in the state of Florida scrambling to find a workers comp carrier.

Epcot Center, Disney World, Orlando, Florida

What could be in store for future rates?

Hurricane Michael Relief

In response to Hurricane Michael, Florida Governor Rick Scott issued an emergency order that make sure “additional protections” are in place for Florida policyholders – including freezing any rate hikes for 90 days.

The order requires that insurers:

Provide an additional 90 days to policyholders to supply required information to their insurance company. Many Floridians were displaced during this dangerous storm, and providing additional time to submit information to insurance companies gives them needed flexibility.
Rescind for 90 days all non-renewals or cancellations issued to policyholders in the days leading up to Hurricane Michael. This gives policyholders 90 days to either renew their insurance policy, or find a new policy; and
Freeze any and all efforts to increase rates on policyholders for 90 days.

Independent Medical Review Program

Florida is looking in to implementing a 6-year-old independent medical review program for workers compensation claims. This program has been enacted by the state of California and has been a resounding success. Under this program disputes about the medical treatment of injured workers are resolved by physicians instead of by the courts. California has found this has enabled for a more efficient resolution of claims while reducing the need for lengthy and costly judicial processes.

New State Senate Promising to Revisit Florida’s Workers Comp Laws

The new President of the Senate in the state of Florida, Bill Galvano, is promising to revisit Florida’s workers’ compensation insurance laws. At a recent ceremony shortly after taking over as President of the Senate Galvano said, “I don’t want to be in a situation where they spike and then we are running to fix it at that point”. Statements like these from the leadership of the Florida legislature show the decision makers in the house are looking forward to attempt to provide a stable market for the business community and eliminate the volatility businesses have seen in recent years for Florida Workers Comp Rates.

Turtles and Alligator at Busch Gardens, Florida

Florida Workers Comp Requirements

There are several requirements for businesses operating within the state of Florida. First and foremost, non-construction companies with four or fewer employees are required to purchase employees. It does not matter if those employees are full or part-time. All construction related businesses are required to secure coverage no matter the number of employees within the business. Sole Proprietors and Partners are not required to cover themselves and are exempt from coverage. A corporation and LLC may exempt officers if each owner owns less then 10 percent of the stock in the business. Sole Proprietors and Partners are not required to cover themselves and they are automatically excluded. These people can elect to be covered using form DWC-251. Corporate Officers of non-construction businesses can exempt from coverage if they own stock and hold an office on the board of directors. LLC Members of non construction businesses are treated as employees, but may be exempt of they so choose.

Miami, Usa, Beach, Miami, Miami, Miami

What can Florida Business Owner do to Maximize Savings?

Shop around your Policy

It is not a wise decision to switch carriers every year for a slight decrease in premium. This is because when a claim does occur a carrier will take in to consideration how long you have been a customers of theirs when they are deciding to raise your rate or deny your business coverage. At the same time, it is important to make sure your business is getting a competitive rate. The best way to do this is to partner with an independent agent who can shop around your policy for you. This can save you time and usually result in lower premium payments on more comprehensive coverage.

Invest in Safety Protocols

Safety is the name of the game in any business. It is what is best for your employees as well as your customers. It is also important when it comes time to purchase commercial insurance. a safer business will have less claims and the claims it does have will be less severe. A small investment in a safety program can pay huge dividends when looking for the lowest Florida Workers Comp Rates.

Choose the Pay as You Go Option

Pay as You Go Workers Compensation Insurance is an excellent option for seasonal and cash strapped businesses. This option allows businesses to get coverage in place at a significantly lower rate than a traditional workers comp policy. Once a policy is in place, the premium is paid monthly based upon the actual payroll from the previous month. This is a great option if your business operates in an industry that has a hard time forecasting payroll for a number of reasons. If your payroll is significantly lower one month the payment will reflect that and the same will occur in months when your workforce represents more man hours. Finally, a Pay as You Go Policy prevents most mid-term audits from occurring because the payments are more accurate from month to month and not based upon an estimate from previous years payroll. This prevents an unwelcome surprise from occurring at the end of a term when a business under pays premium throughout the year and has an unexpected payment to end the year.

Indiana Workers Compensation 2019

Indiana Workers Compensation Rates are going down by an average of more than 7%.

Indiana Workers Compensation Rates 2019 will be going down by an amount of 7.6 percent on average for businesses throughout the state. The Department of Insurance approved the decrease in the month of October and the benefits go in to effect the first of January 2019. This savings is estimated to amount to a savings of more than $60 million for Indiana Businesses.

Indiana Workers Compensation

Why are Indiana Workers Compensation Rates 2019 Declining

Many things go in to what a business pays for workers compensation insurance. The experience modification rate of the business and the strength of the assigned risk provider in the particular state equate an enormous amount towards what a carrier decides to charge a business for coverage. Indiana Workers Compensation are decreasing because of lowering frequency of worker injuries. The department of insurance also credited a robust job market as a reason for lower rates because as the economy grows people open more businesses which create a larger base for insurers to collect premiums.

Indiana Farm In Winter

How can Business Owners Maximize saving on Indiana Workers Compensation Rates 2019?

Shop Around Your Indiana Workers Compensation Policy

It is never a good idea to switch carriers at the drop of a hat because of a small drop in premium. At the same time it is equally important to shop your policy around periodically to ensure your carrier is offering a competitive price. An efficient way to do this is to partner with an independent agent.

Use an Independent Agent

Partnering with an independent agent is always a great way to ensure maximum savings on the most comprehensive coverage available. An independent agent is a good partner because they can shop your policy around to multiple carriers in an attempt to get better coverage at lower rates by forcing the carriers to compete for your coverage. An independent agent will allow you to focus on running your business while your agent shops around your insurance policy.

Ensure Your Business is Classified Properly

Far too many businesses have employees that are not classified properly. If you have different types of employees than it is important to discuss this with your insurance agent at renewal. This can be an issue if you have some employees who are in office/clerical positions yet other employees who may be in other positions that are more physical in nature. When employees are classified improperly, it is typically cleared up during the post term audit. Even when t his mistake gets cleared up during the end of term audit, it still causes the business to either over pay throughout the year or have an unexpected additional payment at the end of the term. In order to not over or underpay your insurance premium, make sure you are placed in the proper classification code.

California Workers Compensation Rates 2019

Prices are Declining for California Workers Compensation Rates in 2019

During the year 2019, California Workers Compensation Rates are going to cost the business community less than in 2018. The average rate of $1.63 per $100 in payroll by Jan. 1 will be approximately 72 percent lower than when rates peaked in 2015. In 2015 the recommended rate was $2.81 per $100 in payroll. According to California Insurance Commissioner Dave Jones, “Cost savings in the workers’ compensation system have helped insurers and employers deserve to share in the cost savings through lower premiums,” This is the lowest rates for workers compensation insurance have been in the state of California in five years.

What is contributing to Lower California Workers Compensation Rates 2019?

California has some of the highest rates for workers comp in the country the California Workers Compensation Bureau WCIRB has pointed to a high frequency of permanent disability claims as a reason for higher costs. Also, California has a higher than average cost of handling claims and delivering benefits. This contributes to the state having higher rates for workers compensation premium. Businesses in the state of California spent $16.2 billion on workers’ compensation just last year.

In 2019, California Work Comp Rates are continuing to decrease for the fifth straight year. These declines occurred primarily because of reforms made to fight the opioid epidemic, low inflation for medical and pharmaceutical costs, and increased fraud investigations. Because of these efforts throughout the entire workers compensation system, the amount paid out for opioids in 2018 was nearly a fifth of what it was in 2013. This drop was from $15,687 to $3,204 per 100 claims, according to WCIRB (The California Workers Compensation Insurance Rating Bureau). A large part of the reason for the decrease in what the workers compensation system paid out for opioid prescriptions is because California enacted a program called CURES (Controlled Substance Utilization Review and Evaluation System). CURES is a database of Schedule II, III and IV controlled substance prescriptions dispensed in California serving the public health, regulatory oversight agencies, and law enforcement. The CURES Program requires dispensing pharmacies, clinics, or other dispensers of Schedule II through IV controlled substances to provide specified dispensing information to the Department of Justice on a weekly basis in a format approved and accepted by the DOJ. This has significantly decreased the amount of opioid abuse throughout the state and that has benefited the workers compensation system.

What can Business Owners do to continue saving on California Workers Compensation Rates 2019

California Workers Compensation Rates 2019 are decreasing for the fifth straight year. This represents a decrease of 72 percent over this time period, but businesses in California still pay more for workers comp coverage than nearly all states throughout the country. Because of these high rates, it is important to maximize savings in any way possible. Here are five ways business owners can alter the way they do business in order to save on commercial insurance.

Make sure your business is classified properly

Far too many businesses are classified improperly for purposes of workers compensation insurance. This is attributed to a number of reasons, but many times it is because a business owner rushes through the quoting process when purchasing Workmans Comp Insurance California. An insurance agent can only act upon the information they are given by the business owner when they are shopping for the best coverage to fit a business owners needs. If the business owner does not explain many intricacies of their business, the business may be classified improperly and pay more or less for coverage throughout the year. This mistake usually gets cleared during the end of term audit, but it can cause a business to owe additional premium. Even if the business over pays and is issued a refund, it means the business has tied up valuable cash flow in unnecessary premium payments throughout the year. These unnecessary payments could have been used on other more important business expenses.

Implement a Safety Program

A Safety Program can help limit the cost of workers compensation insurance in California because it will limit both the frequency and severity of claims. When you business has less claims and the claims you do have are small, the insurance carrier is more likely to offer your business a favorable rate for premium.

Start the Safety Program the day employees are hired

Safety Programs should be a part of your company culture. This should not start after a month in which a few accidents occur. Safety should be part of the training program from the moment an employee starts on the job. The more the business (especially the key employees) talk about safety, the more likely that message is to fester throughout the organization.

Add a Return-to-Work Program to your Safety Policy

A Return to Work Program can significantly impact your experience modification rating in a positive way. When an employee is hurt and not able to work they are much more likely to develop new habits outside of their daily work routine. The longer they stay off the job, the more likely the injured employee is to become long term unemployed. This can have a drastic impact on the experience modification rating of the business. Businesses that are able to get an employee back on the job, even in a limited capacity, are more likely to have those employees return to permanent work.

Communicate with your Insurance Carrier and Healthcare Provider

Communication is key when it comes to navigating the workers compensation system. This is true for the business owner, the injured worker, the insurance agent as well as the underwriter who represents the insurance carrier. The business owner has a responsibility to help the injured worker navigate the workers compensation system and get the care they deserve while not able to work. It is important to keep your agent in the loop throughout this process even though it is the responsibility of the carrier to administer the program. Keeping the agent in the loop can help in the unfortunate event that the carrier is not living up to their end of the bargain. If the agent knows about this process throughout, they can help hold the carrier accountable.

What are the Requirements for Workers Compensation Insurance Coverage in the State of California?

In California, all employers are required to purchase workers compensation coverage regardless of the number of employees. Sole Proprietors are not automatically included in coverage, but can elect to be included using the Acord 130 Application. Partners are automatically included on policies and they are not allowed to be exempt. Corporate Officers who happen to be the sole shareholder are excluded from coverage, but they have the ability to elect coverage if they so choose. All LLC Members who work within a business are included for coverage, but non-working LLC Members are excluded from coverage unless they elect to be covered using the Acord 130 form.

What are the Payroll Requirements for Business Owners in California?

According to California regulation, Sole Proprietors who elect to include themselves on workers comp coverage must use a minimum payroll amount of $52,000 and a maximum of $133,900 for rating purposes as of January First, 2019. Partners, Officers and LLC Members who do not excluded themselves from coverage must utilize a minimum payroll of $52,000 and a maximum of $133,900 for the purpose of rating workers comp premium.

My Insurance Question is a blog published by the insurance experts at the Insurance Shop LLC. If you are in the market for any form of commercial insurance give us a call at 1-800-800-4864 or start a quote here: Start a Quote with The Insurance Shop

Workers Compensation Insurance Rates Tennessee 2019

Steep Decline in Workers Compensation Insurance Rates Tennessee 2019

For the sixth year in a row, the Tennessee Business Community will benefit from a decrease in the amount they pay for workers compensation insurance premium. Earlier this month, the Tennessee Department of Commerce and Insurance (TDC&I) announced an approval of a 19% decrease in pure premium rates for Workers Compensation Insurance Rates Tennessee 2019. This reduction is in addition to previous reductions of 12.6% and 12.8% that were approved in 2017 and 2018. This current reduction will go in to effect on the first of March 2019.

What Caused a Reduction in Workers Compensation Insurance Rates Tennessee 2019?

The main reasons for a reduction in Workers Compensation Insurance Rates Tennessee 2019 is because employers are seeing fewer significant workplace injuries, a decrease in lost-time frequency, and the overall average cost per case as well as the medical cost per case have decreased.

Many within the industry in the state of Tennessee are complimenting the reforms made to the workers’ compensation system in 2013. These reforms especially contributed to a decrease in lost-time frequency. This means injured workers are spending less time off the job and are returning to full-time work more quickly and more often than in years past. In addition to a decrease in lost-time, both indemnity average cost per case and medical average cost per case have remained “relatively stable” according to representatives from the National Council on Compensation Insurance (NCCI).

Because the insurance carriers have benefited from less costs some of the savings are being redistributed to the business community in the state of Tennessee. These savings are being redistributed in the form of lower Tennessee Workers Compensation Insurance Premiums. Since 2013, Tennessee has seen a reduction of 48% on average for workers compensation premium over the past five years.

Before the most recent reductions in premium, Tennessee was the 28th most affordable state in the country for workers comp coverage according to a biennial study done every two years by the state of Oregon. When this study is released again in March of 2019 Tennessee can expect to be much lower in the rankings.

Colorado Workers Compensation Premium Rates

Business Owners will soon Celebrate Because of a Decrease in Colorado Workers Compensation Premium Rates

Colorado Workers Compensation Premium Rates will be decreasing in 2019 by an average rate of more than 10%. This impact will go in to effect on January 1, 2019 and will be the fourth straight year business owners have enjoyed a decrease in the amount they pay for workers compensation insurance premiums.

Views like this High Mountain Lake contribute to the decrease in Colorado Workers Compensation Premium Rates

The Colorado Division of Insurance previously approved a recommended decrease of 16.7% based on recommendations from the National Council on Compensation Insurance (NCCI). The Colorado State Provider, Pinnacol, said its rate change is different because it reflects longer-term underlying loss and expense trends. They are moving forward with a smaller annual decrease in order to minimize volatility in the short term and create stability for business owners over a longer period of time.

As of 2017 rates in Colorado were 19 % lower than the national average. After two years of increased savings, the state system will more than likely rank even better in 2019. Oregon Workers Compensation Premium Rate Ranking will come out in March of 2019. This is a study that comes out every two years. The previous rankings was listed in 2017 for the rankings from 2016. Next March the rankings will again be listed for rates form 2018.

What Contributed to the Colorado Workers Compensation Premium Rates Decreasing for the Fourth Straight Year

The three main aspects that contributed to Colorado Workers Compensation Premium Rates declining are increased cost efficiency, favorable claims trends driven by safer workplaces and a strong Colorado economy. Pinnacoll did not move forward with the full amount of decrease recommended by the Division of Insurance and NCCI because they plan to keep the market stable and give additional savings back to its members via a dividend. Not giving the full recommended decrease may allow Pinnacol to continue to offer a moderate decrease continually and avoid a large decrease one year followed by an increase the following year to stabilize the market. Leaders at Pinnacol believe this moderate decrease will allow the business to compete in the workers compensation system and keep rates as low as possible for all Colorado businesses.

How is Colorados’ Workers Compensation System Unique?

Colorado is not a partner with the National Council on Compensation Insurance. Thirty-two states use NCCI to determine recommended pure premium rates for workers compensation. Four states are Monopolistic States meaning they have their own workers compensation system that does not recognize other staets when a business enters that state for any reason. The rest of the states wither have their own state provider or the use a public private partnership. Colorado uses a public private partnership to administer the provider of last resort within the state workers compensation system. This company is call Pinnacol. Established more than 100 years ago, Pinnacol was formed to provide some stable workers compensation coverage to businesses within the state no matter the size or anticipated risk of the business. Currently Pinnacol represents approximately 56,000 customers.

Nonprofit Directors & Officers Liability Insurance

Directors and Officers Liability Insurance (D&O) are frequently associated with large for-profit companies. Unfortunately, for-profit companies are not the only types of companies who can benefit from Directors and Officers Liability Insurance. Many people within the non profit industry misunderstand that officers and directors (including trustees) of a nonprofit organization are exposed to liability for their relationship with the non-profit organization. In today’s litigious society, if a person sits on a board for a nonprofit the likelihood that they will at sometime have to face some type of liability is high. Nonprofit Directors and Officers Liability Insurance is a necessary coverage for all non profit organizations.

Nonprofit Directors & Officers Liability Insurance

The primary role of directors and officers of a non profit organization is to manage the fiscal stability of the organization as well as to provide the staff of the organization with an environment where they can safely and successfully execute the mission of the organization. Many instances arise where the nature of the non profit organization is drastically different from the experience of the people who sit on the board. The non profit commonly asks for these people to sit on the board in order to get guidance from their area of expertise. This does not dissolve these leaders from liability relating to all aspects of the organization. This means all organizations should carry adequate insurance coverage. Here are four reasons to carry adequate insurance coverage and three tips to limit exposure of all nonprofit organization.

4 Reasons to Secure Coverage

Volunteer Protection Act

The Volunteer Protection Act was passed in 1997. This Volunteer Protection Act states that no volunteer of a nonprofit organization or governmental entity shall be liable for harm caused by an act or omission of the volunteer on behalf of the organization or entity. These laws are limited to areas in which the directors have specific expertise and certifications showing their expertise in any area that benefits the non profit. These protections are not all encompassing and the directors still face liability if they give faulty advice or offer advice outside of their realm of expertise. Because of the limits of this and other similar state laws, non profit organizations need to secure adequate insurance coverage.

Many Reasons for Officers to Face Liability

Directors and officers can be sued for a range of issues including fiduciary responsibilities, improper conduct by employees and volunteers, failure to fulfill the organization’s non-profit mission, and misuse of donor funds. The number of reasons a lawsuit can occur is long and vast. The only true way to protect a nonprofits board of directors is to secure adequate Nonprofit Directors and Officers Liability Insurance.

Many Nonprofit Organizations Face Liability

Sixty-three percent of nonprofit organizations reported a D&O claim within the past ten years. That is compared to only twenty-seven percent for private companies. Leaders in the nonprofit industry are forced to juggle many responsibilities. These responsibilities include dealing with a tight budget, engaging with volunteers and wealthy donors. All while serving the mission of the organization. Leaders frequently serve in a leadership position at a nonprofit organization because of a deep passion for the community they serve and the mission of the nonprofit organization. Unfortunately, many of these same leaders forget to use equal discretion in their non profit life as they do in their professional life. This is likely to cause the higher likelihood of a non profit organization to face a lawsuit. Nonprofit Directors and Officers Liability Insurance is always the best way to protect the leaders within an organization and will up the likelihood of qualified people to serve on the organizations board.

Damages Often Exceed the Assets of the Nonprofit

In most cases, a nonprofit organization is not operating with a huge budget surplus. Most nonprofits do not have an extensive amount of cash on hand. Because of this lack of cash, most non profits do not have the ability to provide legal defense costs when it faces a lawsuit. Nonprofit Directors and Officers Liability Insurance can cover some or all of the legal costs resulting from lawsuits against leaders of the organization.

3 Tips to Limit Exposure

Understand the Organizations Risk

Taking the time and effort to understand all of the risks a nonprofit organization faces is the first and most important step any organization needs to take in order to prevent the exposure non profit organizations face. Partnering with an independent insurance agent and other risk management professionals is the best way to attempt to understand exactly how much risk the organization faces and the best way to limit the exposure.

Implement Safety Programs

Adequate safety measures are important for all non-profit organizations. Because of the common use of volunteers it is crucially important to train the key employees on how to administer a safety program. It is equally important to be able to express the importance of that safety program to all volunteers and other third parties associated with the organization.

Purchase Nonprofit Directors and Officers Liability Insurance

The absolute best way to protect a nonprofit organization and its leaders is to purchase Nonprofit Directors and Officers Liability Insurance. Partnering with an independent insurance agent is a great way to get the most comprehensive policy and acquire credits and discounts on behalf of the organization. An independent agent can quote your policy to multiple carriers and force them to compete for your business. Having an insurance professional on the board of directors may be beneficial to many nonprofit organizations.

Class Codes	Brief Business Description of Operations we Cover
8864	Social Services Organizations.
8842	Group Homes.
7720	Juvenile Detention Centers.
8742	Social Services Professionals.
8833	Hospital Professionals.
9040	Hospitals- Non Professional (non-medical). Applies to above whereas employee is not medically trained such as maintenance, laundry, food services.
8837	Charitable and Welfare Organizations- MA, TX, WI. Includes organizations that collect, recondition and sale items in their stores.
8861	Charitable and Welfare Organizations- MO, NV, VA. Applies to most organizations that provide charitable or welfare assistance to the needy, challenged, or abused. Organizations may provide accommodations, meals, counseling, etc.
9063	YMCA, YWCA, YMHA, and YWHA institutions.
OTHER	Other target classifications used by many non-profits and charitable organizations include: Transportation Services (Meals on Wheels)- 7382, Special Needs Schools- 8868, Companions- 8835, Congregate Meal Sites- 9079, Food Pantry- 8006, Home Health Aides- 8835, Soup Kitchens- 9079.

9 things to know about Liquor Liability Insurance

Liquor Liability

Liquor Liability Insurance is also known as dramshop liability in many parts of the United States. Most businesses that sell or serve alcohol are either legally required to buy Dram Shop insurance, or will benefit and protect their business by having this insurance coverage. Here are nine things to consider when deciding to buy Liquor Liability Insurance.

Liquor Liability

Dram Shop Laws exist in 43 states

“Dram Shop” laws (a law that makes a business liable if they serve a patron who is clearly intoxicated) exist in forty-three states. Each law is unique to the state it exists in. Most laws require some legal liability to be placed on any business serving alcohol or allowing alcohol to be served on a property owned by the business.

Liquor Liability Laws differ by state

Each state has their own unique laws governing liability. The best way to make sure you have the proper protection for your establishment is to partner with an independent agent who has experience offering coverage to liquor serving establishments.

Most states require coverage

In most states it is a requirement to carry Liquor Liability Insurance just to be in business. Even if the law does not require coverage, it is always best to carry some coverage to protect the business from liability resulting from the actions of intoxicated patrons.

Most Banks or Financial Institutions Require Liquor Liability Coverage

Even if your individual state does not require coverage, many banks and other financial institutions require coverage in order to get a loan on a property or a business line of credit.

You don’t have to serve alcohol to be sued

If you rent out a facility that allows parties where alcohol is served or sold, you can be sued because of the actions of intoxicated guests at your facility. If you allow guests to rent out your property and alcohol is served, you can protect your business with Dram Shop Liability Insurance.

Some states allow multiple establishments to be defendants in a lawsuit.

Most states only allow them to be defendants in a lawsuit when an intoxicated person causes bodily injury to a third party after attending the establishment. Even if the patron spent a majority of the night consuming alcohol at another location. The establishment must prove that the patron was not or did not appear intoxicated while at their establishment.

Homeowner’s and Commercial Property have Lower Limits

Some Homeowner’s or Commercial Property Insurance Policies cover liquor liability. Typically this coverage is very specific and the limits are much lower then a Liquor Liability Insurance Policy. If Dram Shop Liability is covered by a homeowners insurance policy, it commonly is limited to $100,000 to $300,000 in coverage, according to the Insurance Information Institute (I.I.I.).

Underage Drinking is not covered by Liquor Liability

Most all Liquor Liability Policies do not cover issues regarding underage drinking. This is because underage drinking is a crime. If the establishment served an underage patron, they broke the law. Any time a crime is committed it invalidates an insurance policy. This is why you see managers and bouncers acting like professional wrestlers when they encounter an underage drinker on their premises.

Alcohol Awareness Education

Many carriers offer discounts on liquor liability coverage to establishments that provide alcohol awareness education and training to employees. This is a must for any establishment that offers alcohol. Not only because it can reduce what you pay for commercial insurance, but it can drastically lower the likelihood of a severe incident occurring on your premises.