Why Small Business Owners Need Workers’ Compensation Insurance
By: Mike Meeneghan – President, Penn Community Insurance
Running a small business is exciting. Business owners control their own destiny, choosing when, where, with whom, and how to work. But as thrilling as the undertaking can be, it holds challenges as well, from cultivating customers to addressing the myriad tasks that come with managing a company.
One vitally important step when starting or running a small business is identifying the risks the business faces and then protecting the business from those risks. Every business owner manages risk to their property, assets and income in one way or another. Some – intentionally or unintentionally – choose to assume the risk themselves, by underinsuring their businesses or even skipping certain types of business coverage altogether.
In fact, 3 out of 4 businesses in the U.S. are underinsured by at least 40 percent. Furthermore, according to the Insurance Information Institute, about 4 in 10 small business owners have no insurance at all because they claim they are cash constrained. The uninsured may be buying into a common misconception that small business insurance is expensive. The truth is that not having insurance can cost a lot more than annual premiums, and you can end up losing your livelihood in the process.
That’s why smart business owners shift the liability for risk to a third party: an insurer.
At Penn Community Insurance, we advise business owners to consider several essential types of insurance coverage that will provide them a safety net in the case of catastrophic events, impactful circumstances, or accidents that result in injuries. One of those essential types of coverage is workers’ compensation insurance.
All states require businesses to protect employees from injury and illness on the job. In Pennsylvania, if you employ any workers, whether part-time, or full-time, or even family members, you are required by state law to carry workers’ compensation insurance. New Jersey also requires most employers to carry workers’ compensation insurance.
Workers’ compensation insurance helps pay for medical costs and lost wages when an employee is injured or sickened at work. It is designed to be the sole remedy for employee's therefore it protects employers against lawsuits filed by injured workers.
When considering worker’s compensation, keep in mind that there can be a difference in the cost from insurance company to insurance company. Also keep in mind that your company’s workers’ compensation claim experience can have a direct impact on the premium you will be paying. The lower your claim experience is the lower premium you may pay. Hiring practices (Are you hiring your next workers compensation claimant?), workplace safety practices, (Eliminating the causes of potential injury or sickness.), and getting immediate care with an occupational healthcare provider (A doctor or provider trained in occupational medicine.) and a solid return to work program can help you keep your costs as low as possible.
That’s why we offer a variety of workers’ compensation and risk management services. As a local, independent insurance agency, we have the ability to shop multiple insurance companies – we represent more than 50 of them – to tailor coverage that is perfectly suited to meet the needs of your business. Our agents take the time to sit down with you, using their extensive knowledge of our insurance products and services to ensure that you leave with the policy that’s best suited for your business. We will thoroughly assess your business and situation to develop creative, comprehensive, cost-effective workers’ compensation insurance solutions that fit your needs.
As a business owner, you can’t outrun your risk, but you can be ready for it, and Penn Community Insurance can help.
INSURANCE PRODUCTS ARE OFFERED THROUGH PENN COMMUNITY INSURANCE, INC. AND ARE OBLIGATIONS OF THE ISSUING INSURANCE COMPANIES, ARE NOT OBLIGATIONS OR DEPOSITS OF OR GUARANTEED BY ANY BANK AND ARE NOT INSURED BY THE FDIC OR ANY OTHER AGENCY OF THE UNITED STATES. INSURANCE PRODUCTS ARE NOT A CONDITION TO ANY BANK LOAN, PRODUCT OR SERVICE. PENN COMMUNITY INSURANCE, INC. IS A LICENSED SUBSIDIARY OF PENN COMMUNITY BANK.