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One way to lower Workers’ Compensation (WC) Insurance is to close claims quickly. Unfortunately, some claims seem to take on a life of their own, and what starts out as a small medical claim morphs into a lost time claim. Proactively and carefully managing WC claims is key to minimizing the risk of that happening and affecting your bottom line (higher WC costs, lower productivity, unnecessary use of resources, lower employee morale, and lost time). The first step is to recognize what causes small claims to morph into big ones.

6 Things that Cause Small Workers Comp Claims To Morph Into Big Workers Comp Claims

1. Lack of Communication With Injured Employees

As with any relationship, communication is vital. Unfortunately, many business owners are under the false impression that communicating with injured employees can cause WC claims and increase the cost of those claims. Nothing could be further from the truth. 

An injury can be frightening for an employee. They may worry about their injury, recovery, or how they’ll continue to support their family. They may be in pain or facing unfamiliar medical treatments. Furthermore, WC claims can be complicated. Regular communication helps employees understand your policies related to injuries and return-to-work programs, helps ease their minds, and creates a more collaborative relationship to bring claims to a close quickly.

Furthermore, one study found that “46% [of injured employees] said they hired attorneys because they felt the claim had been denied when, in fact, it had not yet been accepted into the process.” And the truth is that WC cases that involve attorneys often cost more. 

2. Lack of Medical Care

Continuing to work with the injury may cause a minor injury to turn into a more severe injury. But sometimes injured employees are not aware that their medical expenses will be paid in full by WC if the injury occurs in the workplace, or they may be concerned about losing time from work, so they don’t go to a physician.

Furthermore, it may seem easier for the supervisor/manager to make an incident-only record instead of a WC claim when the injury occurs. That can lead to many headaches and cost more down the road, so injured employees must be encouraged to seek medical attention if injured on the job immediately.

3. Lack of Proper Medical Triage

Some bigger businesses and insurers have triage nurses who can evaluate an injured employee and recommend appropriate medical treatment. Many small to medium-sized businesses do not have this luxury and rely on a physician in an emergency room or urgent care.

As an employer, you need to ensure that employees understand your Return-to-Work program and encourage them to describe their regular work duties to the physician who treats them, so the physician can make an informed decision about whether an injured employee can go back to their regular work duties or perhaps lighter duties.

4. Improper Medical Care

Primary care physicians are great at handling routine sickness but may not be the best choice for workplace injuries. However, there are medical care providers who specialize in work-related injuries and realize that many employers offer RTW programs and the benefits of these programs to both employer and employee.

The PA Workers’ Compensation Act allows employers to establish a list of designated healthcare providers and states that injured employees “must seek treatment for the work injury or illness with one of the designated providers for 90 days from the date of the first visit.” Without this list, injured employees can seek medical treatment from any provider. Creating a list of good healthcare providers for your injured employees not only helps you manage healthcare costs and lower WC insurance; it also helps ensure that your injured employees receive the best care possible. 

5. Fraud

Fortunately, most employees are honest and hardworking; however, a few will try to take advantage of the system by committing WC Fraud. Examples of fraud include faking an injury, inflating an injury, and reporting an injury that happened off the job. Employers and medical providers can also engage in fraudulent WC activities. There are steps you can take to recognize and prevent WC fraud.

6. Not Having a Return-to-Work (RTW) Program

We’ve mentioned RTWs several times, so it may be obvious how crucial they are to prevent small claims from morphing into big claims and, of course, lowering WC costs. An RTW program is designed to get injured employees back to work as soon as possible (based on their doctor’s recommendation). That could mean the injured employee returns to modified duties or a temporary position to accommodate any limitations caused by the injury.

Lower Your Workers’ Compensation Costs

Doing what you can to ensure that small WC claims don’t morph into big WC claims is one way to lower your Workers’ Comp costs. Buying the right WC Insurance is another. Our experienced independent agents at American Insuring Group can help you save on the insurance that's right for you.

Call us today at (800) 947-1270 or (610) 775-3848, or connect with us online!

Workers' Compensation (WC) Insurance is required for almost every employer in nearly every state, including Pennsylvania. WC provides wage-loss and medical benefits to employees injured on the job and reduces employer litigation costs. However, no employer wants to pay more for WC insurance than necessary, so savvy businesses are always on the lookout for ways to lower WC costs.

Good job descriptions can lower Workers' Comp and other operating costs, but sadly, many businesses have inadequate or no written job descriptions.

What is a Good Job Description?

"A job description is a tool that explains the tasks, duties, function, and responsibilities of a position," according to Strategic Human Resource Management (SHRM). "It details who performs a specific type of work, how that work is to be completed, and the frequency and the purpose of the work as it relates to the organization's mission and goals."

HR experts suggest that all job descriptions include the following elements:

• Heading Information – job title, pay range, reporting relationship, hours, and likelihood of overtime or weekend work
• Summary of Objectives of the Job – general responsibilities, essential tasks, expected results
• Qualifications – education, experience, training, technical skills
• Physical Requirements (essential for lowering WC costs) – Is heavy lifting required? Are there long periods of standing? Does the job require climbing? Is driving a part of the job? Are specific body parts taxed more than others?
• Job Duties and Responsibilities – what tasks need to be performed and accomplished

SHRM recommends the following steps to create a good job description:

1. Perform a Job Analysis
2. Establish the Essential Functions
3. Organize the Data Concisely
4. Add the Disclaimer
5. Add the Signature Lines
6. Finalize

Why Are Good Job Descriptions Helpful?

No law requires employers to create job descriptions, but they can be extremely useful for the following:

• Recruiting and hiring purposes – A detailed job description will attract candidates with the right qualifications to perform the job, limiting the number of applicants and saving you time.
  
  
• Determining salaries – When job requirements are laid out – education, training, certification, physical requirements, etc., it's easier to determine appropriate compensation.
  
  
• Conducting performance reviews – A detailed job description provides a gauge managers can use to evaluate an employee's performance.
  
  
• Mitigating risk and limiting liability – An accurate and updated job description can become a helpful legal document if an employee files a lawsuit against you.
  
  
• Exempt vs. non-exempt – A job description can help justify an employee's exemption status under the Fair Labor Standards Act.
  
  
• Lowering Workers' Compensation costs – Correctly matching a worker's physical abilities to the physical demands of a job can decrease the risk of an injury and a resulting WC claim. Fewer claims mean lower WC premiums. Also, a detailed job description is an essential tool for a physician who is determining whether an injured worker is capable of returning to work in either a full or modified capacity. Studies have shown that getting an injured employee back to work as quickly and safely as possible is the best approach for both the employee and the company because claims are resolved more quickly; administrative costs, overtime pay, absenteeism, lawsuits, and staff turnover are reduced; productivity, employee morale, and employee relations are improved.

Do You Want to Lower Your Workers' Compensation Costs?

At American Insuring Group, we offer cost-effective Workers' Comp insurance from various competing insurance companies. We work diligently to ensure you receive the best price on quality insurance that protects your employees and your business.

Ready to save? Call us today at (800) 947-1270 or (610) 775-3848, or connect with us online!

No employer wants to pay more for Workers’ Compensation Insurance than necessary. Still, they also don’t want to be caught being underinsured, which is why assigning the correct job classification codes is crucial.

What are Job Classification Codes?

A job classification code is a three- or four-digit code that is assigned to every employee based on the type of duties they perform. Most states use the National Council on Compensation Insurance (NCCI) classification system. However, other states use their own classification system. As of this writing, those states include:

• Pennsylvania
• Delaware
• New Jersey
• New York
• North Carolina
• Indiana
• Massachusetts
• Michigan
• Minnesota
• Wisconsin
• California

In Pennsylvania, the Pennsylvania Compensation Rating Bureau (PCRB) is the Workers’ Compensation rating authority.

How do Job Classification Codes Affect WC Premiums?

Whatever classification system is used, these codes are based on the amount of risk a job or work environment may pose. Each code is assigned a specific value based on these risks, which then helps insurance companies determine the cost of WC premiums. The higher the risk, the higher the value assigned.

This is the basic (oversimplified) formula used to calculate your premiums:

RATE x (PAYROLL/100) x EXPERIENCE MODIFIER = PREMIUM

RATE is determined by an employee’s classification code value based on the likelihood of that employee being injured on the job. An employee performing a more dangerous job, such as a construction worker, will have a classification code with a higher value than someone in a less risky position, such as an office worker.

If you were to accidentally assign the code for a construction worker to an office worker, you’d end up paying more for WC insurance than necessary. On the other hand, if you accidentally (or purposely) assign the code for an office worker to a construction worker, you could face fines and potential lapses in coverage.

Employee vs. Independent Contractor

In most states, any business with one or more employees is required to carry Workers’ Compensation Insurance for its employees. As we said, EVERY employee is assigned a classification code. If you higher an independent contractor, you are not required to carry Workers’ Compensation for that individual, which is why many business owners are tempted to classify an employee as an independent contractor. This is not a good idea for many reasons.

“In the event, an employer is uninsured at the time an employee suffers a compensable work-related injury, the department will pursue reimbursement from the employer of monies paid from the Uninsured Employers Guaranty Fund in relation to the claim. Reimbursement will include costs, interest, penalties, fees under section 440 of the Worker’s Compensation Act and attorney fees,” according to the Pennsylvania Department of Labor & Industry. “The department will also pursue prosecution against the uninsured employer under section 305 of the Act.”

Misdemeanor convictions can result in a $2,500 fine and up to one year in prison for each day the employer is in violation. Felony convictions can result in a $15,000 fine and up to seven days in jail for each day the employer intentionally violated the requirement.

The injured employee can also sue the employer for work-related injuries or diseases.

Get The Right Worker's Comp Insurance

Ensuring that the correct job classification code is assigned to each employee can be overwhelming, especially if you have thousands of employees or locations in multiple states.

The agents at American Insuring Group specialize in Workers’ Comp insurance and can help ensure that the correct job classification codes are assigned to each employee. And, remember that job duties can change, so a regular review of job codes can help ensure that your employees have the right Workers’ Comp coverage.

Don't overpay for WC Insurance! Contact one of our agents specializing in Workers Compensation Insurance today at (800) 947-1270 or (610) 775-3848, or connect with us online.

Workers’ Compensation (WC) Insurance and OSHA standards may seem interconnected, but they are two separate entities. 

What is OSHA?

The Occupational Safety and Health Administration (OSHA) was created in 1971 as a result of the Occupational Safety and Health Act of 1970. Its purpose is to “assure safe and healthful conditions for workers.” 

Based on extensive research, OSHA sets and enforces requirements and standards that employers are required to follow to help keep employees safe. The organization also provides training, outreach, education, and compliance assistance. 

OSHA states, “Under the OSHA law, employers have a responsibility to provide a safe workplace.’ Those responsibilities include, but are not limited to, the following:

• Keep records of work-related injuries and illnesses. (Note: Employers with ten or fewer employees and employers in specific low-hazard industries are exempt from this requirement).
• Ensure employees have and use safe tools and equipment and properly maintain this equipment.
• Use color codes, posters, labels, or signs to warn employees of potential hazards.
• Establish or update operating procedures and communicate them so employees follow safety and health requirements.
• Provide safety training in a language and vocabulary workers can understand.

Failure to comply with OSHA’s requirements and standards can lead to fines and even criminal prosecution referrals. The maximum penalty for violations is $15,625 per violation, and the maximum penalty for willful or repeated violations is $156,259 per violation. 

What is Workers’ Compensation Insurance?

In Pennsylvania (and many states), Workers’ Compensation Insurance is mandatory, employer-financed, no-fault insurance. It typically covers lost wages, medical expenses, disability payments, and death benefits related to work-related injuries or illness and protects employers from accident-related lawsuits. 

If an employer is uninsured when an employee suffers a compensable work-related injury, the employer will be required to reimburse any money paid from the Uninsured Employers Guaranty Fund in relation to the WC claim, including interest, penalties, and fees. Failure to comply can also lead to jail time. If the violation is deemed intentional, the employer could be charged with a felony offense with up to seven years of prison time. Furthermore, employers who fail to provide WC insurance can be sued by the injured employee for injuries related to the job. 

Bottom line: OSHA is focused on providing a safe work environment and minimizing the risk of injury, and WC Insurance is focused on providing medical care for employees injured in the workplace. 

How Can OSHA Compliance Help Lower Workers’ Comp Costs?

According to OSHA, “In 1970 [when the act was instated], an estimated 14,000 workers were killed on the job – about 38 every day. For 2021, the Bureau of Labor Statistics reports this number fell to about 5,190 or about 14 workers per day. At the same time, U.S. employment has more than doubled to over 143 million workers at more than 10 million worksites. The rate of reported serious workplace injuries and illnesses has also dropped markedly, from 10.9 per 100 workers in 1972 to 2.7 per 100 workers in 2021.” 

Because OSHA’s standards and regulations help lower the number of workplace injuries, complying with them helps lower WC costs. 

Creating a safer workplace is good business sense. Here are a few of the benefits:

• Happier employees
• Lower employee turnover
• Lower absenteeism
• Fewer lost workdays
• Better company reputation
• Fewer lawsuits
• Increased productivity
• Lower administrative costs
• Lower Workers’ Compensation Insurance costs 

Experts have found that businesses see an average return of $4-$6 for every dollar invested into workplace safety programs. 

5 Tips to Become OSHA Compliant

1. Understand OSHA’s Standards and Regulations
2. Utilize OSHA’s Resources
3. Develop, Implement, and Enforce a Workplace Safety Program
4. Create a Safety Culture

How to Save Even More on Workers’ Compensation Costs

Creating a safer work environment helps reduce the number of WC claims, thereby reducing WC costs. In addition, working with one of the experienced independent agents at American Insuring Group can help you save even more. For a free quote on any of your insurance needs, give us a call today at (800) 947-1270 or (610) 775-3848 or connect with us online.

Most states – including Pennsylvania – require employers to provide Workers' Compensation Insurance for their employees. Workers Comp (WC) is designed to ensure employees injured on the job receive proper medical care and protect employers from direct lawsuits resulting from those injuries. 

While WC insurance is mandatory and even a good investment for most employers, it can be complicated and costly if not managed properly. 

12 WC Tips Every Employer Should Know:

1. Understand How Your WC premiums are Calculated

Pennsylvania Workers' Compensation premiums are based on the following formula: WC Premium = Classification Code Rate X Experience Modifier X payroll/$100. Understanding this calculation reveals how you can lower your WC costs. 

2. Train Employees

The Occupational Safety and Health Administration (OSHA) states, "Training in the safe way for workers to do their jobs well is an investment that will pay back over and over again in fewer injuries and illnesses, better morale, lower insurance premiums, and more." OSHA also reports, "Over 60 percent of chief financial officers in one survey reported that each $1 invested in injury prevention returns $2 or more." 

3. Develop an Ergonomic Program

According to ErgoPlus, Musculoskeletal Disorders (MSDs) account for almost 400,000 injuries every year and one-third of all WC costs, resulting in 38% more lost time than the average injury or illness. Whether your industry is highly dangerous or relatively safe, musculoskeletal disorders can affect your workers. An ergonomic program can help minimize MSDs. 

4. Provide Proper PPE

Personal Protective Equipment (PPE) is equipment employees wear to minimize exposure to chemical, electrical, physical, and other workplace hazards. Providing proper PPE can reduce injuries and illnesses, thereby lowering WC Insurance costs. 

5. Develop Clear Job Descriptions and Assign the Right Classification Codes

Every employee is given a classification code based on the likelihood of being injured on the job: the more dangerous the job, the higher the classification code, and the higher the WC premium. Assigning the correct classification code to each employee is crucial because if you accidentally classify an accountant as a driver, you'll pay more than necessary for WC coverage. Conversely, if you classify a driver as an accountant and you're caught, you may be required to pay the outstanding amount owed and/or severe penalties. Developing clear job descriptions can make classification easier. 

6. Accurately project and monitor payroll

When purchasing WC coverage, your annual payroll will be estimated based on your current circumstances, which of course, can change. When your insurance carrier conducts its annual audit, you may receive a credit or a bill based on the actual payroll. Monitoring and reporting your payroll throughout the year can help improve your cash flow. 

7. Always Investigate an Accident

Every Workers' Compensation Insurance claim should be investigated because it's imperative to making accurate and legal assessments related to primary liability.

8. Communicate

Did you know injured employees typically hire a lawyer because of inadequate communication with their employees - not to get more money? So communication – with new employees, injured employees, physicians, etc. - is the key to lowering WC costs. 

9. Prevent Insurance Fraud

Most employees and employers are honest; however, a small group of people costs companies billions of dollars annually by committing WC Insurance fraud. Preventing this fraud can help lower your insurance costs. 

10. Learn How to Read a Loss Run Report 

 Loss Run Reports show your company's claim activity for the policy period. You can use the information from this report – the date of each loss and claim, a brief description of each claim, the amount paid to the insured, and whether or not the claim is closed – to lower your insurance costs and improve other areas of your business.

11. Review annually

With all of your time-consuming responsibilities, it may be tempting to simply renew your WC Insurance policy as is, but that could cost you money. Reviewing your policy offers an excellent opportunity to check for errors and provide any updates to ensure that there aren't any gaps in your insurance and that you aren't paying more than you need to.

12. Find the Right Insurance Agent

The right insurance agent can help save you money, avoid insurance gaps, and help protect your business. The independent agents at American Insuring Group are trusted Workers Comp Insurance experts who compare policies and cost among lots of competing carriers to help get you the best deal on quality insurance protection.

So start saving by calling us today at (800) 947-1270 or (610) 775-3848, or connect with us online.

Musculoskeletal disorders - one of the fastest growing threats to workplace safety and health – are costing $20 billion a year in Workers' Compensation Insurance costs and an additional $100 billion in lost productivity, employee turnover, and other indirect expenses, according to the Centers for Disease Control and Prevention (CDC). In 2019, musculoskeletal disorders accounted for nearly one-third of all worker injury and illness cases, according to the U.S. Department of Labor. 

Any employee can experience this type of injury, but they are becoming more prevalent with the aging American workforce. A repetitive stress injury (Aka, repetitive strain injury, repetitive motion injury, repetitive use injury, and RSI) is a musculoskeletal disorder. 

The industries most at risk for RSI include the following:

• Manufacturing
• Retail
• Health Care
• Office
• Construction
• Food Preparation
• Transportation

What is a Repetitive Stress injury?

Repetitive stress injuries are defined as painful musculoskeletal disorders "caused by cumulative damage to muscles, tendons, ligaments, nerves, or joints (as of the hand or shoulder) from highly repetitive movements." RSIs commonly affect wrists, elbows, arms, shoulders, fingers, and knees. Any motion or movement can cause an RSI if repeated too often – even typing on a computer. 

• RSIs can lead to several conditions:
• Tendinitis – Inflammation of the tendons
• Carpal Tunnel Syndrome – Excessive pressure on the median nerve, which runs from the forearm into the palm of a hand
• Muscle strains and low back injuries
• Rotator cuff injuries
• Epicondylitis (Aka Tennis Elbow)
• Trigger Finger – affects tendons that flex the fingers and thumb
• Tenosynovitis – Inflammation to the tendon and the sheath around a tendon

Common causes of RSIs include poor posture, working in the cold, working with a vibrating tool, performing a high-intensity activity for a long time without resting, or holding an awkward position. 

Repetitive stress injuries occur over time. Symptoms include pain, tingling, throbbing, numbness, stiffness, weakness, swelling, and sensitivity to cold or heat. Employees who experience any of these symptoms should not ignore them, which can lead to more severe RSI injuries. 

Treatment of RSIs depends on the severity of the symptoms and what is causing them. Typically, the best treatment is to reduce or modify the activity that caused the injury. 

10 Tips to Prevent Repetitive Stress Injuries

1. Provide ergonomic training that includes the principles and applications of ergonomics; proper use of equipment, tools, and machine controls; good work practices, including proper lifting techniques; recognition of RSI symptoms; the importance of reporting RSIs before they become more serious; etc.
   
   
2. Provide appropriate ergonomic tools, such as chairs that support the back, headsets for long phone calls, and adjustable desks and computer monitors.
   
   
3. Establish a culture of safety
   
   
4. Limit repetitive motions and exposure to vibration
   
   
5. Maintain good posture
   
   
6. Avoid prolonged sitting at a desk or computer
   
   
7. Adjust your workstation
   
   
8. Take regular breaks from repetitive tasks
   
   
9. Stretch throughout the day
   
   
10. Use tools correctly

Lower Your Workers' Compensation Insurance Costs the Easy Way!

Most states – including Pennsylvania – require that all employers carry Workers' Compensation Insurance for all employees; however, there are many ways to lower the cost of WC insurance. Preventing repetitive stress injuries is just one way. Working with the independent agents at American Insuring Group – who offer cost-effective worker's compensation insurance from various competing insurance companies – is another way, and it's easy!

Call us at (800) 947-1270 or (610) 775-3848 or connect with us online.

To lower Workers’ Compensation Insurance costs for your business, you may want to consider a wellness program. Wellness programs offer many benefits and aren’t just for big companies. Statistics show that 58% of small to medium-sized businesses (3-199 employees) provide wellness programs. The return on investment (ROI) for employee wellness programs is $6 for every $1 spent.

What is a Wellness Program?

SHRM states, “Wellness programs are provided to employees as a preventive measure to help avoid illness while improving and maintaining the general health of the employees. This can be accomplished through education, communication, and a supportive work environment.”

Wellness programs may address physical health, mental health, substance abuse, or chronic pain. They may or may not include incentives - such as health insurance premium discounts, contributions to health savings accounts, cash or gift cards, etc. - to participate in the program. SHRM cautions, “Employers should make sure their wellness incentives are designed, so they do not inadvertently lead to unhealthy behaviors. For example, a per-pound weight loss incentive with no limits may encourage unhealthy weight loss practices. Or an incentive for attending a fitness center that expires after one year may result in employees ending their regimens.”

Wellness programs may include one or more of the following:

• Nutrition education
• Diabetes management programs
• Weight-loss programs
• Preventative health screening
• Health risk assessments
• smoking cessation programs
• Stress management programs
• Gym memberships
• Worksite exercise programs and activities
• Vaccination clinics
• Health fairs
• Wellness publications
• 24-hour nurse hotline
• CPR or first-aid training
• Massage therapy services
• Financial wellness
• Recreational programs, such as company-sponsored sports teams

What are the Benefits of a Wellness Program?

Employees spend a substantial amount of time at work, and unfortunately, workplaces often lead to ill health. For example, desk jobs can lead to inactivity and weight gain, and work stress has been shown to cause many health issues. So, it’s no surprise that wellness programs provide many benefits for employers and employees alike:

• Reduction in healthcare costs. In 2019, 72% of employers implementing a wellness program saw reduced healthcare costs.
• Reduction in absenteeism (14-19%).

• Increased productivity. 84% of employers reported higher productivity and performance from their employees due to wellness plans in 2019.

• Reduced injuries.
• Reduced Workers’ Compensation and disability-related costs.
• Increased employee morale. More than 80% of employees who work for an employer engaged in their wellness enjoy their work. On the other hand, of those whose employers aren’t engaged in their wellness, only about 40% say they enjoy work.
• Attract and retain employees. Research shows that 87% of employees consider if an employer offers any type of wellness program when choosing an employer. In addition, 85% of employees who work for an employer engaged in their wellness say they intend to stay at their jobs. On the other hand, of those whose employers aren’t engaged in their wellness, only 58% say they plan on staying with their current employer.

*Statistics from Zippia.

How is a Wellness Program Established and Designed?

SHRM suggests the following steps to establish and design a wellness program:

1. Conduct assessments
2. Obtain management support
3. Establish a wellness committee
4. Develop goals and objectives
5. Establish a budget
6. Design wellness program components
7. Select wellness program incentives or rewards
8. Communicate the wellness plan
9. Evaluate the success of the program

Easy Workers’ Comp Insurance Savings

The independent agents at American Insuring Group will work hard to get you the best price on quality insurance to protect your employees and your business.

Give us a call today at (800) 947-1270 or (610) 775-3848 or connect with us online.

Within small to medium-sized businesses (SMBs), the role of Workers' Compensation manager is often given to someone who has other roles within the business and little to no experience with WC. Unfortunately, Workers' Compensation can be complicated, and mistakes can be costly. So, if you find yourself in the role of WC manager, here are eight tips to help.

1. Know What Your State Requires -Your state will determine whether or not you are required to carry Workers' Compensation Insurance, the WC regulations you need to follow, and how you can purchase the insurance. Click here for a state-by-state comparison and links to the entities responsible for Workers' Compensation. And remember, even if you are not required to purchase WC insurance, it may be worth having.
   
   
2. Understand WC Basics – You need to know what WC does and doesn't cover, what WC classification codes and experience modifiers are, etc. Check out these 10 PA WC FAQs.
   
   
3. Know How Workers' Comp Premiums are Calculated - Your Workers' Compensation premium is based on the following formula: WC Premium = Classification Code Rate X Experience Modifier X payroll/$100. Understanding this calculation helps you 1) ensure no errors are made and 2) see where you can save money on WC costs.
   
   
4. Understand the Effect of Safety on WC Costs – According to The Pennsylvania Compensation Rating Bureau (PCRB), your experience rating is based on past claims and helps determine your experience modifier, which is an adjustment of your annual premiums based on the likelihood that you will file a claim. The safer your workplace, the fewer claims you will file, which lowers your experience modifier and what you pay for WC insurance.
   
   
5. Realize That Timing is Crucial – Injuries should be treated immediately and reported promptly. Failure to report an injury promptly can jeopardize investigations, increase potential litigation, violate state law, and increase the cost of the claim. You must also manage WC claims (see below) to ensure quicker resolution.
   
   
6. Consider a Return-To-Work Plan – The sooner you can get an employee safely back to work, the better. Studies show that returning to work after an injury is essential for recovery and can help reduce your WC costs. One way to get an injured employee back to work sooner is with a return-to-work program (RTW). An RTW is designed to get injured employees back to work as quickly as possible (based on their doctor's recommendation). That could mean the injured employee returns to modified duties or a temporary position to accommodate any limitations caused by the injury.
   
   
7. Manage WC Claims – An employer's role does not end with filing a WC claim. Managing a WC claim is key to a quicker resolution, which includes ongoing communication with the injured employee, their medical team, and your insurance company during the claims.
   
   
8. Learn How to Read a Loss Run Report - Loss Run Reports list the date of each loss and claim, a brief description of each claim, the amount paid to the insured, and whether or not the claim is closed. Insurance companies use this information to determine how risky your business is to insure, which can affect your premium. Therefore, you should check that the information is accurate, and you can use the information to lower insurance costs and improve other areas of your business.
   
   
9. Protect Your Business from WC Insurance Fraud – Most injured employees are honest; however, some employees commit Workers' Compensation fraud, costing companies billions of dollars every year in rising insurance premiums, production delays, and training costs. Protect your business from WC insurance fraud by recognizing the warning signs of fraudulent claims.
   
   
10. Review Annually - Your insurer will conduct an annual audit, and so should you. It's an opportunity to check for errors and provide any updates.

Bonus Tip: SAVE by Working With the Right Insurance Company

Each business has particular needs, and American Insuring Group specializes in commercial insurance for small to medium-sized businesses. In addition, we offer cost-effective Worker's Compensation insurance from various competing insurance companies. We'll work hard to get you the best price on quality insurance to protect your employees and your business!

Get a free quote today by calling (800) 947-1270 or (610) 775-3848, or connect with us online.

There are many myths or misconceptions about Pennsylvania Workers' Compensation Insurance that can end up costing business owners time and money. So let's set the record straight on these myths once and for all. 

What is Pennsylvania Workers' Compensation (WC) Insurance?

Most states, including PA, require employers to carry WC for their employees. The PA Department of Labor & Industry states, "If you employ workers in Pennsylvania, you must have workers' compensation insurance -- it's the law." This includes both full and part-time employees, even if they are family members. There are very few exceptions. 

If a worker is injured in the workplace or becomes ill because of their work environment, Workers' Compensation (WC) helps cover medical costs and lost wages if the employee cannot work. In Pennsylvania, it doesn't matter who or what caused the injury. If the injury or illness occurred during the course of their employment with you, WC would pay those expenses. 

WC also limits an injured employee's right to sue an employer directly for damages that injury or illness causes. 

Most Common Workers' Compensation Myths

MYTH 1: You don't need WC coverage for your business.

FACT: In Pennsylvania, if you employ even one person, even if that person happens to be your brother-in-law, you probably need to carry WC coverage for that employee. The only exceptions are If ALL employees fall into one or more of the following categories:

• Federal workers
• Longshoremen
• Railroad workers
• Casual workers
• Persons working out of their own homes or other premises not under the control of management
• Agricultural laborers making less than $1200 per calendar year
• Domestic workers who have not elected to come under the provisions of the Workers' Compensation Act
• Sole proprietors or general partners
• Those who have been given an exemption by the Department of Labor and Industry due to religious beliefs
• Executive officers who have been granted exclusion by the Department of Labor and Industry
• Licensed real estate salespersons or associate real estate brokers affiliated with a licensed real estate broker or a licensed insurance agent affiliated with a licensed insurance agency, under a written agreement, remunerated on a commission-only basis and qualifying as independent contractors for State tax purposes or Federal tax purposes under the Internal Revenue Code of 1986. 

If a business does not qualify for one of these exceptions, it must carry Workers' Compensation Insurance for its employees. Failure to do so can result in the employer being required to pay back any costs paid by the Uninsured Employers Guaranty Fund or a work-related injury or illness, including interest, penalties, and fees. An uninsured employer may also face civil and criminal risks that can result in fines and imprisonment. 

MYTH 2: Your company must be at fault for Workers' Comp to pay.

FACT: As mentioned above, Pennsylvania WC is a no-fault system. Regardless of the cause of the injury - a faulty machine, a mistake made by an employee, etc., if the injury occurred in the course of their employment, WC will pay. 

MYTH 3: An injury must happen on-site to file a WC claim.

FACT: If an employee is injured while driving to a meeting, at a work conference, etc., while conducting business for you, you can (and should) file a WC claim. 

MYTH 4: All work-related injuries are covered by Workers' Comp.

FACT: In Pennsylvania, Workers' Compensation claims can be denied to employees whose injuries are caused by the use of illegal drugs or alcohol intoxication. 

MYTH 5: Your role ends once the WC claim is made.

FACT: When an injury occurs, you are responsible for submitting the claim form and supporting documentation promptly; however, your responsibilities don't end there. 

You also need to manage the WC claim, continue cooperating with your insurance carrier, help ensure the claim is resolved quickly, keep in touch with the injured employee, and consider return-to-work options when appropriate. 

MYTH 6: A minor injury is not worth reporting

FACT: Injuries that initially seem minor may become more severe and require additional medical treatment. Not reporting work-related injuries can keep your employees from receiving proper care and put your WC policy at risk. 

Reduce Your Workers' Compensation Insurance Cost

Understanding these common myths and working with one of the experienced independent insurance agents at American Insuring Group can help ensure you get the best coverage at the lowest cost. Our independent agents shop the market to help you save on the proper insurance protection for your business.

Contact us today at (800) 947-1270 or (610) 775-3848, or connect with us online.

If you’ve ever worked with Workers’ Compensation Insurance, you’ve probably come across the term “indemnity.” So let’s take a look at both Workers’ Comp Insurance and indemnity entail. 

What is Workers’ Compensation Insurance?

In Pennsylvania, Workers’ Compensation (WC) Insurance is “mandatory, employer-financed, no-fault insurance which ensures that employees disabled due to a work-related injury or disease will be compensated for lost wages and provides necessary medical treatment to return them to the workforce.” 

If an employer fails to carry WC and an employee suffers a work-related injury, they will be required to reimburse the PA Department of Labor & Industry for money paid by the Uninsured Employers Guaranty Fund concerning the claim, plus interest, penalties, and fees. In addition, an uninsured employer may face civil and criminal risks. 

A misdemeanor conviction could result in a $2,500 fine and up to one year of imprisonment for each day the employer is in violation. Felony convictions could result in a $15,000 fine and up to seven years in prison for each day the employer is in violation. 

What Are Indemnity Benefits?

An indemnity benefit is the money an injured employee receives for lost wages while they are unable to work due to a work-related injury or illness. There are basically four different types of indemnity benefits. 

1. Temporary Total Disability (TTD) benefits are paid when an injured employee is temporarily unable to return to any job with the same employer – neither the work they performed before the injury nor any other position with that employer. This is the most common type of indemnity benefit. Typically, with a TTD benefit, injured employees are paid two-thirds of their pre-injury average weekly rate. 

2. Temporary Partial Disability (TPD) benefits are paid when an injured employee can return to work (as determined by the treating physician) for a limited time. For example, if an injured employee was working an eight-hour day before their injury, but following the injury, their physician stipulates that they can only work four hours per day, they would receive TPD benefits. The amount of the payments is typically the difference between the injured employee’s average weekly wage (AWW) and the amount they are able to currently earn, multiplied by two-thirds. TPD = (AWW – current wage) x 2/3. 

3. Permanent Partial Disability (PPD) is defined by the International Risk Management Institute (IRMI) as “a workers compensation disability level in which the injured employee is still able to work but not with the skill and efficiency demonstrated prior to the injury. As a result, the earning capability of the worker is affected.” These payments are typically based on the percentage of the disability. 

4. Permanent Total Disability (PTD) benefits are paid when the physician determines that the employee will never be able to return to work. The IRMI states, “Under most statutes, the employee will receive weekly wages for life.”

 NOTE: When discussing indemnity, you may also hear the term “maximum medical improvement” or MMI. MMI is “a legal concept where no further significant recovery from or lasting improvement to a personal injury can be reasonably anticipated, regardless of subjective complaints from the employee. In essence, additional medical care and treatment may still be required to keep the employee in a stable condition, but no noticeable improvement will take place in that medical care.” 

How to Lower Workers’ Compensation Insurance Costs?

Workers’ Compensation Insurance can be complicated, but the more you understand it, the more likely you can lower your WC costs.

The agents at American Insuring Group specialize in Workers’ Compensation Insurance and would be happy to work with you to explain the ins and outs of this – and all your commercial insurance needs – and help ensure that you have the right coverage at the lowest cost.

Contact us today at (800) 947-1270 or (610) 775-3848, or connect with us online.