Workers' compensation insurance provides employees injured on the job with medical treatment and prescribed wage replacement. All employers are mandated to provide their employees with workers' compensation coverage. In exchange for this coverage, employees cannot sue the employer for the injuries. Not having proper coverage can result in fines and possible jail time.
Benefits paid for injuries under workers' comp include:
• Medical treatment — Medical costs are paid with no deductibles or co-payments.
• Temporary disability — While recovering from injuries, workers receive two-thirds of their average weekly wage, up to a maximum set by the state legislature.
• Permanent total disability — Payments are set at a statutory maximum.
• Permanent partial disability — Workers with permanent partial disabilities receive additional payments that are intended to compensate them for the loss of earning power as a result of their injury.
The workers' comp system in California was in crisis in the late 1990s. By 2003, employers were paying an average of 6.5 percent of payroll, and insurance companies were paying out $1.86 in claims costs for every $1 of premium collected.
Nearly 25 insurance carriers were forced into insolvency. The State Compensation Insurance Fund swelled and covered more than 60 percent of the workers' compensation market because private carriers could not predict what premiums to charge.
This crisis led to landmark reforms in 2003/2004 designed to bring stability back into the system. The reforms focused on putting the injured worker back on the job. These measures have saved California employers billions, and some companies have seen their workers' compensation costs decrease by 70 percent.
Despite these savings, California remains among the most expensive states for coverage. California's rate remains higher than the national median, and medical costs are on the rise again, challenging the stability that was created by the 2003-04 reforms.
There are three criteria that insurance companies generally use to determine the premiums. These are: payroll, the company's classification, and loss experience record.
In determining the loss experience factor, the individual business is compared with other businesses based upon frequency of accidents and severity of injuries. The more accidents an employer has had, the higher the modification rating. Go without losses and your premiums receive credits.
An effective safety program can ultimately help mitigate workers' compensation premium costs. Of utmost importance is the safety manager's ability to motivate, educate and train employees.
A good safety program will educate all personnel about safety rules, workers' compensation and their duties and responsibilities in the workplace. The more education and training you give your employees, the fewer injured workers you will have.
And finally, a little bit of individual empathy will go a long way toward having a satisfied employee rather than a disgruntled and insecure employee who worries about losing his job or benefits.
For more information on workers' compensation or other insurance issues, contact
Brubaker & Associates at (760) 931-1021 or visit
www.brubakerassociates.com
Benefits paid for injuries under workers' comp include:
• Medical treatment — Medical costs are paid with no deductibles or co-payments.
• Temporary disability — While recovering from injuries, workers receive two-thirds of their average weekly wage, up to a maximum set by the state legislature.
• Permanent total disability — Payments are set at a statutory maximum.
• Permanent partial disability — Workers with permanent partial disabilities receive additional payments that are intended to compensate them for the loss of earning power as a result of their injury.
The workers' comp system in California was in crisis in the late 1990s. By 2003, employers were paying an average of 6.5 percent of payroll, and insurance companies were paying out $1.86 in claims costs for every $1 of premium collected.
Nearly 25 insurance carriers were forced into insolvency. The State Compensation Insurance Fund swelled and covered more than 60 percent of the workers' compensation market because private carriers could not predict what premiums to charge.
This crisis led to landmark reforms in 2003/2004 designed to bring stability back into the system. The reforms focused on putting the injured worker back on the job. These measures have saved California employers billions, and some companies have seen their workers' compensation costs decrease by 70 percent.
Despite these savings, California remains among the most expensive states for coverage. California's rate remains higher than the national median, and medical costs are on the rise again, challenging the stability that was created by the 2003-04 reforms.
There are three criteria that insurance companies generally use to determine the premiums. These are: payroll, the company's classification, and loss experience record.
In determining the loss experience factor, the individual business is compared with other businesses based upon frequency of accidents and severity of injuries. The more accidents an employer has had, the higher the modification rating. Go without losses and your premiums receive credits.
An effective safety program can ultimately help mitigate workers' compensation premium costs. Of utmost importance is the safety manager's ability to motivate, educate and train employees.
A good safety program will educate all personnel about safety rules, workers' compensation and their duties and responsibilities in the workplace. The more education and training you give your employees, the fewer injured workers you will have.
And finally, a little bit of individual empathy will go a long way toward having a satisfied employee rather than a disgruntled and insecure employee who worries about losing his job or benefits.
For more information on workers' compensation or other insurance issues, contact
Brubaker & Associates at (760) 931-1021 or visit
www.brubakerassociates.com