Workers’ compensation claims have a definitive impact on almost every aspect of your business. In a perfect world, there would be no work-related accidents. Unfortunately, work-related accidents do occur, affecting your business. However, you can manage the impact by being proactive and working with your employees during the claims process and their recovery. How your company deals with a workers’ comp claim is the key to protecting your reputation and maintaining its success.
Here are five ways in which workers’ comp claims can affect your business:
Several things factor into how your workers’ comp premiums are calculated. Your industry is a primary factor along with how many employees you have on payroll. Your claims history over the previous three years and your payroll is also included in the calculations. If you have one or two claims on record, it’s doubtful that your premiums will be affected. Multiple claims over a short period of time may cause your premiums to go up considerably.
- Improving Productivity for Payroll
The longer you pay for an employee who isn’t working, the lower will be your overall productivity. Keeping an employee on payroll, even at the lower wage offered by workers’ comp, can negatively impact your business. To re-establish a more positive balance, as soon as the employee is able to return to work, offer them a job. Even if it is in a different capacity, the wages they earn will be more in line with their productivity.
- Administrative and Operating Costs
When an employee is off work due to an injury, your administrative and operating costs will rise slightly. Administrative costs will go up due to increased paperwork while operating costs will rise due to a decline in productivity. Keeping your costs low will depend on how well you are prepared to work with your employees. Getting them back to work in whatever capacity they are capable of will immensely help your finances.
- Legal Action If obstacles can’t be worked out once a claim has been filed, it will be up to you to protect your business. Having an attorney on hand to help is important if your employee hires a workers’ comp attorney to help them sort out their case. A workers’ comp attorney can help them get the compensation they deserve within the boundaries of the law.
- Damage to Your Reputation Repeated claims against your company may cast a bad light on how you do business. Transparency is very important, and protecting your reputation is a must if you want to be productive and successful. Take proactive measures against further legal action by improving your safety protocols and providing training to all of your employees.
When you have questions about workers’ comp insurance and how it can affect your business, you need to talk to insurance professionals who have the facts. Contact our agents at Lou Aggetta Insurance Inc. today! We have valuable information that you can rely on to run your business effectively. Get the information you need so that you can protect both you and your employees.