Tag PEO insurance

Why is pay as you go workers’ comp insurance the right choice for so many businesses these days?

What is Pay as you Go?
In this video clip, CEO John Will Tenney was interviewed by a local real estate office and answers a few questions about Pay as you Go Payroll and Taxes, as well as Pay as you Go Workers’ Comp. Both of these business options can help reduce costly audits and large bills at the end of a fiscal quarter, or the fiscal year.

A big thank you to Rick Aguirre of Remax Realty of Avalon Park for his help with the video.

Pay as you Go for Workers’ Comp
A “standard” workers’ comp policy comes with some “baggage” that many business owners would like to avoid. Not only are there extra fees for a “standard” policy and a possibly expensive audit every year, there are also some added risks. Why else are so many employers now looking at alternative methods? In today’s economy and business environment it pays to be flexible and innovative.

You may be asking what kind of baggage there is. Have you ever asked these questions?

• Who wants to pay a large premium deposit?
• What is this “expense constant” thing they charge?
• Why is it an estimate?
• Why is there an annual audit that usually ends up costing the business owner more money?
• Why is the timing on the big payment always so bad?
• Why are they telling me I am “mis-coded”?

Does any of this sound familiar in your business? How about these?

• Have you ever wondered why they can’t just take the comp premium at the same time you do payroll?
• Did you even know there are “Pay as you Go” workers’ comp insurance programs available?
• Is the only reason you are NOT doing pay as you go because you think it gives up control of your money?
• What is Pay as you go workers’ comp?”

All good questions. Here are some basic answers. (Please contact us to get more answers.)

Workers’ Comp premium is figured as a percentage of payroll for each employee in each “class code.” A “class code” is based upon the job description of the employee. For example, clerical employees and roofers have a different class code and of course a completely different rate of premium. “Mis-coding” is when the people are actually working at, or have different duties than those described in the class code.

PEO Pros functions both as a licensed insurance agency and employer consultants to assist employers in this area. Usually this involves placing the employer with a payroll service, or even a PEO. In many cases the payroll service is optional. Yes, you can still enjoy the transferred liability of a PEO without giving up your payroll.

The advantages to pay as you go services are many but here a few headaches that go away:

• Workers’ Comp annual audit is no longer needed
• Tax forms will be filed by the payroll service
• Large premium deposits go away
• Fewer problems predicting cost of employees
• Easier to add employees without incurring insurance increases
• Since reporting is more frequent (each payroll) changes in job description will likely result in less “mis-coding”

If any of this addresses a problem with your business or company, you may want to give us a call at 800.788.8343 or use the form below to contact us with your inquiry:

Our property and casualty agency has been creating strategic alliances with other large agencies to supply even more markets for business insurance, both to the traditional business owner and PEOs.

Agencies we work with include:
Stonehenge Insurance Services – PEO workers’ comp
Hourglass PC – PEO workers’ comp
Cypress Risk Management – large workers’ comp policies
Pontell Insurance – Business and personal lines
Petrucci Insurance – Business and personal lines
Corsair Insurance Agency – Doctor and Lawyer Professional Liability
Elite Insurance – Business and personal lines
I-surance, LLC – health insurance professionals

We are a provider of master policies to PEOs, Payroll and Staffing Companies for Workers’ Compensation Insurance.

Convenient Links for PEO Owners:

• Our Agency Alliances
• Latest PEO Insurance updates (master policies)

There are several viable options for PEO owners in today’s comp market, including:

• Guaranteed Cost programs
• High deductible programs
• Captive Loss Funds
• Offshore Loss Funds
• “Rent-a-captive” Segregated Portfolios

If you would like to hear more about our PEO master policy options for workers’ comp please contact us using the form below:

We understand that PEO and staffing company owners can be frustrated with the completely different set of skills required to negotiate larger policies with national carriers. For this and other reasons, they come to us for help. Our typical client is someone who realizes that it is better to be represented with an agency with custom solution expertise, rather than get stuck with an “off the shelf” program.

PEO Pros has many alliances which allow us to offer more custom choices to our clients. We work closely with Stonehenge Insurance Solutions, relying on their extensive experience in the field.

In addition to being a licensed General Agency in several states, we also function as master policy insurance wholesalers.

Products we negotiate for PEOs and staffing companies include:

1: Various policies for Workers’ Comp including:

• Master Workers’ Comp Policy
• Multiple Coordinated Workers’ Comp Policies
• Multi-State Workers’ Comp Policies
• Client-based Workers’ Comp Policies

2: Guaranteed cost, high deductible, retroactive and captive management programs
3: EPLI for clients

Should you find yourself in a situation where dealing directly with a carrier (or carriers) is not working to your satisfaction and profit, you may wish to contact us to explore the possibility of a client-agent relationship. Please use the Quick Contact form shown below or give us a call at 800.788.8343. We can’t help you if you don’t contact us.

Why would anyone expect to find all their payroll, workers’ comp insurance and HR answers from one PEO?

Would you buy a suit that didn’t fit? So why expect one PEO to do it all?

Many business owners are frustrated that they can’t find the right payroll, workers’ comp or PEO solution that matches their business. Some small businesses feel “swallowed up” in the machine of a large, national payroll company. Larger businesses find that a local PEO or payroll provider just doesn’t have the experience, service or access to products that they need. There is no “One Size Fits All” in business.

Do any of these comments sound familiar?

• “My PEO doesn’t offer the services I need”
• “Nice fancy PEO website, but I know I am paying for it”
• “All we need is workers’ comp and payroll, why are we paying for all this other stuff?
• “We keep getting denied for workers’ comp coverage”
• “We’re tired of calling a machine. We want to talk to a person!”
• “Our rep? You mean this month’s rep? We’ve had 6 different reps in 6 months”
• “I wish my insurance agent could help us with more than just insurance”

Perhaps you might need a Custom PEO Solution. We may be able to help. Tell us what is missing. Please feel free to contact us using the form below.

While there are many advantages to having a PEO manage your workforce, many times it is troubles with Workers’ Compensation Insurance that brings the client to a PEO.

Is it better to be with a PEO? To have a professional partner to assist you with risk management? We of course, have a bias, but here is another point of view. This is an excellent article written by Antony Kelly
Antony Kelly’s Article

Here are some excerpts we particularly liked:
“Simply put, traditional workers comp coverage will require a small business owner to make an upfront deposit, based on an estimate of their gross annual wages. The company will send quarterly information to the insurer, who then calculates the bill and requests payments. Since these are all estimates, however, an audit is required, including a reconciliation process that will help bring the numbers together. Unfortunately, if the deposits and quarterly estimates do not cover the total amount due, the company is mandated to reimburse the carrier at the end of the year. This could potentially be a substantial cut to the small business person’s cash flow. Interestingly enough, payments that extend beyond the balance may roll over into next years beginning balance; nice for the carrier, bad for the business owner. ”

“PEO companies not only provide you with pay as you go workers compensation but also outsourced benefits and a variety of resources that help you comply with employment related issues and administrative paperwork. In fact, many businesses under 100 employees should be able to significanly reduce their in-house administrative burden through the use of a PEO, which provides additional value over traditional and pay as you go workers comp plans. ”

Thank you to Antony Kelly for writing this article, and to Shane Underwood for finding it.

People ask us when they need a PEO, or even why?

Hard question to answer with anything other than “Maybe you don’t!”

Our staff can spend a lot of time telling you why you should have a PEO, and you can probably find some of that on other parts of this site. For fun though, and maybe for educational purposes, we asked them, “When DON’T you need a PEO?” Well they tossed it around the bullpen and surprise surprise, they came up with at least 7 scenarios when a PEO is not called for.

Here’s some situations they gave us when you DON’T need a PEO:

1: You don’t have any employees
2: You have employees but they cause no problems and create no risks
3: You are a government entity who cannot be sued
4: You are a very large company with an internal legal and HR department
5: You are a very large company with annual workers’ comp premiums in excess of $250,000. (In this case you should have your own, custom comp solution, such as a captive or a self funded plan. Ask us about that)
6: You are a short term company, not likely to be around for a while
7: You will never want to sell your company, or facilitate an easy ownership transfer

Can you think of some others? Please let us know!

Why should an insurance agent work with a PEO Broker?

Here at PEO Pros / PAY-surance HR, we are often asked that question. Since many PEO Brokers are also insurance agents, the strategic partnership may not be obvious. However, most PEO Brokers are smart enough to leave traditional commercial insurance needs to the traditional commercial insurance agents. We certainly do. We figure they are experts at what they do, and we are experts at what we do. Why would we take business away from Agents who could use us for certain niche clients?

So What is That Niche?
There are several:

1: Difficult to place workers’ comp clients. Often times, a client who has difficulty procuring workers’ comp can get coverage by placing their employees with a PEO. This could be a smaller client who doesn’t have a lot of premium, a higher risk client or even a client who has had some claims history in the past.
2: Clients who have had a lot of unemployment claims. There is nothing better than a professional HR partner to assist in reducing unemployment claims.
3: Clients who have had HR difficulties, such as lawsuits from employees. Again, a professional HR partner can assist a client in putting in proper procedures to avoid unnecessary lawsuits.
4: Clients who wish to reduce employee turnover. Often the benefit solutions available from a PEO can offer that high level environment to a smaller client, in such areas as health insurance, 401k benefits, group life insurance and other areas.

We at PEO Pros / PAY-surance HR are always willing to talk to traditional agents and agencies about strategic partnerships. Often times our clients need a service they should get from those agents, such as commercial auto, property & casualty, general liability or even surplus lines and bonds.

If you are an agent, or an agency that is interested in this type of strategic partnership, please feel free to contact us using the form below.

If you are shopping for workers’ comp insurance in the medium to large policy market, it’s a sure bet that you have heard the word “captive” at least once or twice.

In this article there are two types of workers’ comp “captives” that will be discussed.

The first is a group captive. There are many varieties of this flavor. This is a situation where a number of companies pool their resources and set up a small insurance company to insure some part of their risk. They can be shared or segregated. There must be some degree of risk sharing to meet legal requirements.

Some of these are often called a “rent-a-captive.” In some cases this captive is used to reduce the costs associated with a high deductible master policy. For example, if your company has a million dollar per claim deductible (a typical high deductible), you could use a “Buy Back Deductible Captive Policy” to assist with reducing the negative effect of high reserves.

For more information on one type of “buy-back-deductible-captive” – please take a look at Kris Delano’s article. Kris works with us on these type of captives.

Another breed is called a segregated portfolio fund. This is usually held “captive” by a carrier and the risk sharing comes between the captive owners and the carrier.

Both captive plans are designed to help entities with large premium recover some of the premium, based on a good loss ratio. They are also designed to recover some of the losses from the insured (in favor of the carrier of course.) In this way they resemble retroactive plans, also known as “retros.”

In all cases, the shared risk encourages both parties to concentrate more on safety and reduced accidents for a single motive: profit.

Both plans offer some tax advantages due to the increase in tax deductible premium paid up front. If there is underwriting profit, there are options as to when to declare the profit that allow the captive owners to be more selective as to how much tax they will have to pay every year.

Also, since the reserves set for claims will be stored in the captive, and NOT in the carrier’s bank account (reserves are not tax deductible), there is another tax advantage here.

If all this is confusing, please consider consulting with a captive expert before proceeding in to one of these agreements. There are many options to consider, and many steps that require negotiation.

At PEO Pros we do not offer “retail captives.” All of our captive arrangements are negotiated individually, tailored to fit the needs of the client. It is very likely that captive clients will save money by having us negotiate the captive agreement for them.

Please use the form below if you would like more information on a captive situation.

Are you a start up PEO that can’t find a master policy?
Don’t panic.

We can help!

PEO Pros has a special department that handles start up PEOs, Staffing and Payroll companies.

In particular we help with Workers’ Comp, General Liability, EPLI and in some cases Health Insurance.

We have experience with start up companies, so much that the carriers have come to rely on us to help the transition from start up to going concern.

Have you heard these or something similar?

• “We don’t do start ups”
• “We require a minimum book of business”
• “Come back and see us when you have 3 or more years experience”

Sound familiar? Don’t despair. We can help.

Use the form below to get in touch with us.