Cheap workers' compensation insurance

Insurance carriers often offer different types of coverage options with a wide range of prices. And while you could reach out to each insurance company directly to ask for quotes on their workers' compensation insurance policies, there’s an easier, faster way.

You can work with a digital insurance agency—like Insureon—to get workers' comp quotes from top-rated providers, such as The Hartford and Chubb, with a single online application.

Insureon's licensed insurance agents are available to help you customize a policy for your business's unique needs, making sure you meet state laws and your industry's requirements.

Plus, an experienced agent can help you set appropriate limits, recommend endorsements that match your risks, and let you know which add-ons you can safely skip. Without expert help, you might not know if the policy provides too much coverage, or not enough.

Once you select the workers' compensation policy you need, you can get coverage and a certificate of insurance (COI) in less than 24 hours.

The National Council on Compensation Insurance (NCCI) is an organization that gathers data and helps establish workers’ comp insurance rates based on the type of work you and your employees perform.

The Council utilizes more than 700 workers’ compensation class codes to denote the amount of risk and hazard each job might entail, assign a value based on these conditions, and help insurance providers determine the cost of workers’ comp policies.

It’s important for business owners to audit their workers’ comp classifications as new employees are hired, current employees are promoted, business duties are reassigned, or employees leave the company.

Whether intentional or accidental, misclassifying one of your workers could lead to overpaying for your insurance policy, or underpaying. This could lead to hefty fines and penalties, and an outstanding balance owed to the insurance provider after the premium recalculation.

By ensuring each worker is properly classified as either a contractor or an employee (full- or part-time), and listed under the appropriate class code, you can save money and avoid potential legal action.

Pay-as-you-go workers’ compensation insurance offers flexible premiums that change throughout the year. These premiums rely on any changes to your number of employees, as well as your payroll data over the course of one year.

This is a great option for small business owners looking to pay less for workers’ comp, since the initial down payment is likely to be more affordable than a traditional plan.

What's more, it’ll reduce the guesswork in estimating your insurance costs. Every time you run payroll, you’ll know exactly how it affects your insurance rates.

There are a few types of lower premium policies, including:

• Minimum premium workers' comp policy
• Workers' comp ghost policy
• Occupational accident insurance (OAI)

A minimum premium policy and a ghost policy fulfill the obligation to carry a workers’ compensation policy. However, a ghost policy provides zero workers’ comp coverage, and the availability of these policies is dependent on the state your business operates in.

OAI is a voluntary coverage that provides benefits similar to workers' compensation.

A minimum premium policy is the lowest premium an insurance company will sell a policy for, regardless of your payroll or amount of coverage.

For small business owners, this could mean your premiums would be the same if you expanded from one to two employees.

A ghost policy is ideal for self-employed business owners or sole proprietors with no employees who need to show proof of workers’ compensation insurance coverage to either win a new contract or satisfy a state requirement.

This type of policy covers no one and provides no healthcare benefits. It only offers a certificate of insurance (COI).

Occupational accident insurance isn't a type of workers' comp, though it provides many of the same benefits. This voluntary policy is often purchased by freelancers and contractors, especially truckers and motor carriers.

As with workers' comp, it can cover medical bills and disability benefits in the event of a workplace injury. Because it doesn't provide the same level of coverage as workers' comp, it's typically about 30% to 50% cheaper.

In most cases, a safer working environment equates to fewer workers’ compensation claims against your business, as well as a lower insurance premium.

There are several ways you can promote workplace safety and minimize injuries:

• Establish safety procedures and training to reduce workplace accidents
• Provide the proper gear and require adequate footwear
• Post hazard signs and labels
• Maintain tools and equipment and a clean workspace
• Consider ergonomic furniture and equipment

Businesses with good safety records will see this reflected in a low Experience Modification Rating (EMR Rating), which translates into lower rates for their workers’ compensation coverage.

An EMR is one way for insurance carriers to adjust their premiums, based on the expected losses from workers’ comp claims for each company they insure.

The average EMR is 1.0, which means a business is no more or less risky than similar businesses in their profession. A higher rating would mean a riskier business and higher premium, while a lower rating would mean a less risky business and lower premium.

Since workers’ compensation is regulated on the state level, each state has its own requirements and penalties.

Workers' compensation insurance is required in nearly every state, and some states require employers to buy workers’ compensation insurance through a state insurance fund.

These states require all workers’ comp policies be purchased through a state fund:

• North Dakota
• Ohio
• Washington
• Wyoming

However, there are a few exceptions. In some cases, specific types of workers and business structures, such as independent contractors and limited liability companies (LLCs), are exempt from carrying workers’ comp insurance.

Also, South Dakota and Texas are different than most other states because workers’ compensation insurance isn’t generally mandated. Employers without this coverage usually must notify the state and their employees.

Even though your business might be able to save money by not buying workers’ compensation, it’s usually a good investment. Private health insurance won’t cover any work-related injuries or illnesses, which could leave you on the hook for expensive medical bills.

It's important to note that some states mandate workers' comp insurance based on your profession. For example, Florida workers' compensation law states that even self-employed workers in the construction business must have workers' compensation insurance.

Most policies include employer’s liability insurance, which protects your business against lawsuits from injured workers.

Though it may not be the primary factor, small business owners in certain states can expect to pay less for workers' compensation insurance than others.

Here are some states where workers' compensation insurance costs are lower than average:

In addition to your location, your industry can affect how much you pay for workers' comp insurance. Generally speaking, industries that have a higher risk of employee injury or illness can expect to pay a higher premium.

For example, an electrician who handles dangerous electrical wiring on a daily basis will likely pay more for their workers' compensation coverage than a tax preparer who works on their laptop from a home office.

Among Insureon customers, industries such as finance and accounting, IT / technology, and insurance tend to pay less compared to higher risk industries like construction and installation.

Here's a look at workers' comp insurance costs for different types of business professions:

While workers' compensation insurance covers medical care expenses for injured employees and offers death benefits for fatal accidents, it doesn't protect your small business against other types of risks.

You may also need the following small business insurance policies:

General liability insurance: This covers common business risks like customer bodily injuries, damage to a customer’s property, and advertising injuries.

Commercial auto insurance: This policy covers vehicles owned by your business and is required in nearly every state. It typically pays for accidents, vehicle theft, weather damage, and vandalism.

Professional liability insurance / errors and omissions insurance (E&O): If you provide professional advice or services to clients, you likely need this policy. Professional liability and E&O can be affordable while protecting your business if you’re accused of a mistake, oversight, or professional negligence.

Business owner’s policy (BOP): A business owner's policy bundles general liability insurance with commercial property insurance to protect against liability claims and property damage. It generally costs less than buying these two policies separately.

Cyber insurance: This policy helps small businesses recover financially from data breaches and cyberattacks. It's recommended for any business that handles credit cards or other personal information.

Complete Insureon’s easy online application today to find cheap workers' compensation insurance coverage from top-rated U.S. companies. You can also consult with an insurance agent on your business needs, including how to find affordable general liability and commercial auto insurance.

Once you find the right types of insurance for your small business, you can begin coverage and receive your certificate of insurance in less than 24 hours.