Strategizing Worker’s Compensation Program in 2021

Due to the pandemic, economic challenges have required employers and companies to identify potential risks and trends in their insurance coverage, including worker's compensation insurance.

Worker's compensation insurance (WCI) encompasses salary losses and employees' medical and rehabilitation expenses who incurred work-related injury. All American states require WCI to safeguard employees' health. 
​
Read on to determine the considerations needed to be addressed by employers when preparing for a worker's compensation program this 2021. 

Statistical Status of WCI
Marsh Data showed that overall worker's compensation costs decreased by over 5% in the third quarter of 2019. Insurance companies nowadays want to offer WCI to counteract the low profitability in auto and general liability insurance, minimizing their financial pitfalls. 

Employers are challenged to present more information about workers' compensation regarding payroll, history of loss, worker's concentrations, and ensure clear renewal strategies by brokers to reduce financial losses. 

Trends Influencing WCI
Employees should be able to consider these trends may affect the implementation of worker's compensation insurance this 2021: 
​

1. Marijuana Authorization
   Legalizing marijuana remains a mixed debate for employers, whether or not this will be included as treatment under worker's compensation insurance. Nevertheless, this treatment's inclusion will cause adjustments in the implementation of WCI among employees taking marijuana as a form of therapy.
   
   
2. Termination of Terrorism Risk Insurance Program Reauthorization Act (TRIPRA)
   TRIPRA ensures continuous insurance coverage to policyholders by insurance companies for financial risks associated with terrorism. At the end of 2020, TRIPRA will expire, making companies face possible policy price increases and coverage demands, especially employers with a vast group of employees. Financial demands from terrorism are difficult to quantify, compared with other insurable conditions.  
   
   
3. Telemedicine
   Remote medicine might create a significant impact on the medical and health industries. Aside from its primary role for triaging clients, it might provide real-time, online doctor visits, physical therapy, and rehabilitation in the future. This technological advancement will have tremendous implications on the health workers' population (doctors, nurses, and other health care staff) who are formerly assigned to duties related to such tasks. 
   
   
4. Implementation of California’s Assembly Bill 5 (CAB5)
   CAB5, which took effect on January 1, 2020, requires businesses to classify workers as employees or independent contractors. Employers will face huge, uncontrolled costs to sustain employee benefits and other worker's compensation-related privileges once workers are reclassified. 

Conclusion
Employers are now faced with challenges to prepare for compensation programs that cater to employees’ changing needs and ensure extended insurance coverage and renewal.

At Cornerstone Insurance Agency, we do our best in making sure that our clients are well-protected with affordable and comprehensive policies. We make sure to go the extra mile to help you with your needs. To learn more about how we can help you, please contact our agency at (888) 661-8831 or Click Here to request a free quote.