Almost all of Utah businesses are required by state law to carry workers’ compensation insurance. Your workers’ compensation policy will help pay for medical expenses and lost wages of employees who sustain injuries while on the job. Should an employee experience permanent impairment or disability, workers’ compensation insurance can provide disability insurance for the life of the worker.
An employee is entitled to workers’ compensation benefits for injuries even if they have been on the job a brief amount of time and/or is only working part-time. If you don’t carry workers’ compensation insurance, not only are you breaking the law, but you are also exposing your business to serious liabilities should an employee become injured while on the job.
A good place to begin your search for workers’ compensation insurance is to contact the agency that holds your other commercial insurance policies. If your agent doesn’t offer workers’ compensation insurance for your type of business, or if you are concerned that you could be paying too much for your policy, shop around to find the best rates on workers’ compensation insurance for your particular line of work.
As a Utah business owner, if you are unable to purchase workers’ compensation insurance through your insurance agent due to your organization’s high-risk status, you are guaranteed the opportunity to purchase insurance from Workers’ Compensation Fund of Utah.
The Utah Department of Insurance helps keep workers’ compensation premiums at a reasonable cost by establishing basic premium rates. The basic rates are modified by each insurance carrier to account for payroll costs and the loss-potential of specific occupations. Each employers’ claims history for work-related injuries and illnesses is also included in the premium calculations.
A business owner’s annual payroll is a key factor in determining premium rates. When a policy is written or renewed, you will be asked to estimate your employees’ payroll total for the coming year. The payroll estimate amount is multiplied by the rate to calculate the premium that will be due over the next 12 months. An employer obtaining workers’ compensation insurance by fraudulently underreporting payroll is subject to criminal prosecution.
After a policy period expires, your agent should conduct a premium audit to verify your business is only paying the premium you truly owe rather than the premium based on your estimated figures. This could mean an increase in premium if actual payroll was higher than original estimates. Or, it could also mean a refund if those figures were less than your estimated payroll amounts.
One of the challenges of the current work environment is the high level of employee turnover. New employees are not always aware of the best safety practices. When you hire employees from other industries, they might not have the safety experience your more seasoned employees have obtained with years on the job. To help keep your workers’ compensation premiums low, partner with a workers’ compensation insurance provider that supports your organization with value-added services such as safety seminars and industry-specific safety training materials for your employees. A safe work environment is critical to sustaining positive morale among employees, as well as obtaining high levels of achievement in the workplace.
This article was provided by Goldenwest Insurance Services in Ogden.