Beauty Store Business magazine - January, 2020

Get ’Em Under Control

It’s not enough to provide workers’ compensation insurance for your employees. With increasing premiums, you need to control costs too. collection

Employers are grappling with a spike in workers’ compensation premiums after years of virtually level costs. Increasing accident rates and higher medical costs are contributing to the problem. But you can help control the damage by improving safety programs and informing employees about the shared costs of accidents. Workers’ compensation insurance, long a burr under the employer’s saddle, is gaining new prominence in the drive to protect profits.

“We are entering a new environment of rising workers’ compensation costs,” says Peter Burton, senior division executive for state relations at the National Council on Compensation Insurance in Boca Raton, Florida. “It’s estimated that employers are seeing premium increases in the 2% to 5% range as their renewals come up.”

Why the increase? More workers are having accidents, and it’s costing more to return them to health. “Most states have experienced ‘loss cost’ increases over the past year,” says Burton. “That’s a change from the virtually flat or decreasing environment of previous years.” The term “loss cost” refers to the average statewide cost of lost wages and medical payments resulting from injured workers. Higher loss costs translate into higher insurance premiums.

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