Page 19 - WV811 2023 issue 1
P. 19

 Safety First, of Course
Even Though It Still Happens, It Happens a Whole Lot Less
You DO carry Workers Comp, right? Just because
your state says you need to have a stated number
of employees before you are required to carry this coverage, no state law says you aren’t liable for an on- the-job injury if you have less. This seems to confuse a lot of contractors. They somehow get the idea that just because they don’t employ many, that somehow means they are “exempt” (as I was once told).
Absolutely not! All it means is that they won’t violate a state law requiring WC if they have fewer employees! This in no way absolves the employer from medical costs, hospital and doctor bills – not to mention lost wages. And these are expenses that can go on for years! That one employee you have can get in a wreck, and the result can literally cost millions.
Companies are requiring any contractor to provide a certificate of insurance showing that they have Workers Comp in place... even if it’s just a one-man operation. Can you get Workers Comp on just yourself? Definitely! You can get it where you are covered – or that you are excluded as the business owner (called a ghost policy). Yes, it makes sense because if you were to bring on a helper or two – they are covered if anything happened.
WC premiums are based on both payrolls and job requirements. A salesman pays less than a roofer, an in-house salesman pays less than an on-the-road salesman – and you can clearly see the reasoning.
And nothing drives the cost of the coverage more than claims – and nothing reduces claims like safety best practices and safety enforcement from management. Workers Comp costs
That new owner increased his costs of Workers Comp by over 50%, and no, he “didn’t have the time” for safety meetings. “Bad luck” can happen, but how come it happened to him and not the previous owner?
Safety doesn’t cost money, it basically makes you money!
start at 1. No losses over a period of years – it goes to %
of one (discount), claims? 1+% of the rate (penalty). Ideally penalizing those with losses while “rewarding” those with no losses!
But management impacts 80%, if not more, of the losses through safety enforcement. A sign on the wall isn’t enforcement. Many companies have daily safety meetings – daily. And their losses reflect that attention to safety practices. We had a customer – who had a fair number of employees
– was involved in the oil business. He had daily safety meetings – with monthly safety awards – just like a lot of the oil rig companies do. That company ran a Workers Comp “Experience modifier” of .78! In other words, he had a 22% discount. The company sold, and within 3-4 years with the new owner, their “Experience modifier” went to 1.3 – that’s a 30% penalty.
2023, Issue 1 West Virginia 811 • 17

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