Cornerstone Insurance Agency Blog
It's not uncommon for the cost of worker’s compensation insurance to increase each year. According to the National Council on Compensation Insurance, a worker’s comp trade group, worker’s compensation premiums are rising at an average annual rate of 5% to 10%.
If you have a business, you need worker’s compensation insurance. It protects your business from lawsuits if an employee gets injured on the job and ensures that they receive medical care while they are recovering.
How is it Computed?
Worker’s compensation rates are calculated using a complex formula that considers the nature of the work performed, the specific job, and other factors.
For example, employees who work with heavy machinery are more susceptible to injury than those who perform tasks in low-risk environments.
The worker’s compensation rate is a percentage, usually expressed as a fraction. The fraction's numerator represents the work-related injury or illness value, and the denominator represents all other factors in bringing about that injury or disease.
It means that you'll have to divide the worker’s comp rate by 100 to determine your rate.
Worker's Compensation Increases Each Year
Worker's Comp Insurance has been increasing every year. The cost of Worker's Comp is expected to rise by more than $400 billion in 2022.
The price increase is due to the rise in the number of claims that have been made against employers and employees.
Employers in the United States are required to provide worker's compensation insurance for their employees. To pay for this, businesses must pay a fee of around $215 per year.
This rate has been increasing every year since 2008, with the average cost being about $943 per employee.
How can I prepare for this?
The rate increase results from the rising costs of medical care, insurance, and other factors. It has led to an increasing number of workers sustaining injuries or developing diseases that their previous insurance plan could not cover.
Workers injured on the job should file a claim before the filing deadline to avoid problems.
Workers must remain proactive and ensure that they have comprehensive insurance coverage for their workers. It includes compensation, disability, long-term disability, medical payments, life insurance, Medicare Part A & Part B, and more.
Many people are still unaware of the dangers associated with accidents on the job, which is why it is important to consider purchasing worker’s compensation insurance every year.
This type of coverage will provide you with financial assistance for medical bills, lost wages, and other expenses related to your accident.
At Cornerstone Insurance Agency, we put our clients first by offering them policies that they can afford. Having insurance is a necessity nowadays, and we're here to help you out. Learn more about our products and services by calling our agency at (888) 661-8831. You can also request a free quote by CLICKING HERE.