Workers Compensation is a policy that insures against injured employees or death. If your employee is injured or dies in the course of, or arising out of their employment, a workers compensation policy will pay for the medical care to treat the injury as well as replace income for employees missing work due to injury.
Workers compensation premiums are based on payroll divided by 100 then multiplied by a specific rate. A rate is assigned to each job classification based on risk. The riskier the job, the higher the rate will be applied to the classification. An electrician’s workers compensation rating will be much higher than an office based position.
A policy’s premium will then be affected by an experience modifier rating. The more claims against a workers compensation policy, the higher the EMR will be, thus making the insurance more expensive. However, insureds with no claims get rewarded with a rating of less than 1, which will result in a discount to the policy. There are many ways policy holders can work to keep their workers compensation policy as low as possible.