Pay as you go workers compensation insurance- An option to consider for the new normal
Is cash flow important to your business?
As we enter the post Covid-19 “new normal”, life may seem very uncertain. We know cash flow is very important to the health of your business. There is a way we can help your business’s cash flow. It is pay as you go workers compensation insurance.
Pay as you go allows you the ability to report your payroll to the company each time that you pay your employees, whether weekly, bi-weekly or monthly payroll.
What are the benefits of pay as you go workers compensation insurance?
- Improved Cash Flow
- No down payment
- Real-time premium calculations based on actual payroll
- Automatic withdrawals of your premium payments
- No installment fees
- Reduction in audit exposure due to immediate premium calculations
This pay as you go workers compensation insurance is still relatively new and not all insurance companies offer it but many do. Give us a call to discuss the options for your workers compensation coverage.
In these uncertain times, why pay a huge amount for workers compensation coverage only to get a huge refund at the end of the policy term when the audit is completed? Wouldn’t it help your business now to have to pay less each payment and not have a large refund later?
The problem with the traditional payment method of putting a large down payment of 20-25 percent. Then having 3-6 payments is that in the first few months of the policy term it creates a negative effect on your operating cash. Most employers earn revenue thought the entire year, it makes sense to pay insurance premiums over the entire year.
At Huff Insurance we are always looking for ways that we can help your business succeed.
Smaller premium workers compensation accounts may not benefit from this option. But if your premium is $5000 or greater, then it is a good alternative payment option.
Pay as you go workers compensation insurance (i.e. Smart Pay) is another means to allow you, the policyholder, take control of your cash.
Smart Pay is a smart and convenient pay as you go billing option for workers compensation policies.
With most of the carriers you do not need to have outsourced your payroll to get this option. Most carriers with this option have a way to log in and submit your payroll or email them a payroll summary report from your payroll software or complete a worksheet provided by the insurance carrier.
Let the insurance professionals at Huff Insurance look at the options available to you to see if Your Way Pay is a great option for your business.
The amount of each payment will vary with each payroll, based on the amount of payroll reported for that period and the classifications for the employees.
If you are interested in this way to handle your workers compensation expenses, contact us today.
You will still have an audit with this payment method; however, it will be an abbreviated audit where the company will just be looking to confirm subcontractors and payroll verification.