11 Jan Pay as You Go Workers Compensation Insurance 101

Small business owners often struggle to manage the administration of traditional workers’ compensation insurance. Insurers are now offering pay as you go workers’ compensation products as an alternative to traditional policies.

Regular workers’ compensation policies require the business owner to make a forecast of annual payroll. There is often a requirement to make an upfront payment of several months of premiums, and at the end of the year the business records are audited to check that workers compensation regulations have not been breached.

Pay as you go workers’ compensation does away with the requirements to forecast payroll, and have the business books checked by auditors. While these features are popular with business owners, the elimination of prepayments is often viewed with particular favor by business owners because it can help to smooth cash flow.

Both traditional and pay as you go workers’ compensation programs provide workers with protection from costs associated with workplace injuries and illnesses and protect business owners from the risk of civil lawsuits filed by workers.

Whatever type of policy an employer carries there is still a moral obligation to emphasize workplace safety. Business owners who feel that they may benefit from the new alternative to workers’ compensation insurance should ask their agent or insurer whether they qualify for pay as you go workers’ compensation insurance.



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