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Ask Insurance Agents to Trim Premiums
– March 11, 2011

100 WaysInsurance is probably the 2nd or 3rd most costly expense incurred by companies after personnel and facilities costs. Your company needs to evaluate every type of insurance to find ways to reduce costs without sacrificing coverage. If you spend as much time reviewing your insurance costs as you do raw material or other costs, then you are sure to see a reduction.

Being underinsured can be risky for a business. But by the same token, being over-insured can impose significant, unnecessary costs on a company. You would be surprised at the number of businesses that waste considerable sums of money because they have duplicative, unnecessary or obsolete insurance coverage. Review your deductibles and ask your insurance agent for suggestions on how to trim other insurance costs.

The average costs of workers’ compensation insurance is over $700 per employee and employers lose approximately 78 days per year per 100 employees on average to injuries. Exaggerated claims drive up the cost of workers’ compensation; it is estimated that cheating may involve 20% of all claims.

Here are several  ways to reduce your workers’ comp expenses:

  • Institute a modified work/light-duty program for injured employees to get them back to work.
  • Set up employee safety teams to encourage safety on the job by everyone.
  • Make managers accountable for workers’ comp costs and make it part of their performance compensation.
  • Keep track of multiple filings for WC by the same employee.
  • Coordinate workers’ compensation with group health benefits to eliminate duplicate coverage and payments.

There are numerous ways to decrease your insurance costs, it just takes a little time and effort.

 

This is Profit Enhancement Ideas #41 and 42 in Heard, McElroy & Vestal's 100 Ways: The Profit Enhancement Process series. The purpose of the series is to assist business owners and managers in cutting costs and increasing revenues by working smarter, not harder.

Walker CoburnWalker Coburn
318.429.2109
wcoburn@hmvcpa.com

Walker is an Audit Manager in our Shreveport office. He received his Bachelor of Administration in Accounting and a Masters of Accountancy from Millsaps College in Jackson, MS. Prior to returning to his hometown of Shreveport and joining Heard, McElroy & Vestal, Walker worked for KPMG in Jackson and Memphis, and more recently as a financial reporting advisor for FedEx Corporate.

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