PEOs Offer Relief from High Workers' Comp Insurance Rates
For many companies, workers' compensation insurance can be the most expensive part of running their business.
But what many don't realize is that there is a better, less expensive way to purchase workers' compensation insurance. Professional Employer Organizations, also known as PEOs or employee leasing services, offer you savings and advantages the voluntary market cannot. Here are just a few:
1. PEOs Don't Require Upfront Deposits
Unlike the traditional market where a 20-30% deposit is required to start your policy, many PEO companies offer no money down, pay-as-you-go plans. The upfront costs of getting a business started can be staggering. The cash flow advantage of a no money down plan can enable you to keep thousands of dollars in your account.
2. PEOs Offer Discounted Workers' Comp Rates
Imagine paying 40% less on your workers' compensation insurance than your current rates! How much more competitive would that make you compared to your competition? Typical savings average around 22% but bigger savings are common in states with a high percentage of employers in assigned risk pools and soaring work comp rates. Because a Professional Employer Organization is purchasing insurance for so many employers, the difference in costs can be dramatic.
3. Get Relief From a High Experience Modifier (e-mod)
If you've had a few workers' comp claims that have triggered an increase in your experience rating, a PEO service could save you thousands of dollars. A PEO doesn't have to follow the voluntary market's procedure of utilizing your rating. They'll look at your whole history and many times offer you a significant decrease in rates so you don't have to be trapped - or suffer through years of paying additional premiums.
4. No State Expense Fees with a PEO Company
How annoying is it to see on your policy terms every year a few hundred bucks (sometimes more) charged to you from the state for the privilege of having insurance? Most Professional Employer Organizations charge absolutely nothing to get started. No terrorism fees, state expense costs - nothing
5. Claims Management with HR Assistance
Have you ever had an employee file a fraudulent work comp claim against you? If you have, you know how frustrating it is to wait for action while the con cashes in. Traditional carrier's claims management and investigation of fraudulent claims can be weak at best, since you're the one who will ultimately pay more. The PEO company has more incentive to follow up, communicate and close claims as soon as possible - it's their policy, too!
6. PEOs Eliminate Workers' Comp Audits
Dealing with work comp audits is both time-consuming and discouraging. The process just doesn't make sense. When you're bundling the services of payroll and workers' compensation with a Professional Employer Organization, the insurance premiums are deducted and precisely audited each period so you'll never hear the word "audit". You'll also never worry about an unexpected premium bill.
7. Never See Cancellation Penalties or Fees
With a pay-as-you-go PEO workers' compensation plan, there's never a need for back audits or cancellation penalties. If you hit the lottery, sell your business or even close shop for an unexpected reason, pay-as-you-go means just that - when you're done you're done!
For more ways to save on workers' compensation insurance and other employee related costs, call us at 1-888-582-8388 or fill out our quote request form.