Workers’ compensation insurance is an essential expense for any auto repair shop. Still, as a shop owner, you may not fully understand the factors that affect your vehicle repair workers compensation costs, which can make budgeting for this expense or lowering your premiums difficult. Determining insurance rates is a complex process, but the following factors are ones that will generally affect your final cost.
- Industry Hazards: When setting premium costs, insurance providers start by considering the risks that are unique to your business and the typical characteristics of claims in your industry. For example, an insurer may consider the number of claims that result in compensation and the average value of that compensation.
- Your Track Record: An insurance provider will also review the history of claims made at your shop. If you have an unusually high rate of claims, this may suggest that you are failing to take reasonable steps to prevent accidents and injuries. As a result, you may end up paying a higher premium to secure vehicle repair workers compensation coverage.
- Safety Measures: On a similar note, an insurance provider may consider any steps that you currently take to reduce the risk of accidents and injuries. These measures could include extra employee training, the use of special protective equipment or incentives that encourage safer working practices. A strong focus on safety could help lower your premium costs.
Managing Your Costs
If you still have concerns about your workers’ compensation insurance expenses, speaking with an insurance agent may be beneficial. An agent can help you understand the reasons for your current costs and the measures that could help you reduce those costs in the future.