Quality Still Counts
Quality claims control (post injury) is and should be one of, if not the, main factor when purchasing California Workers Compensation Insurance in the current marketplace. It is important for business owners to carefully evaluate any new or financially suspect carrier to make sure that their modification (the controllable portion of your premium calculation) is not jeopardized for a one time savings in premium.
Why would you gamble a 10% one year savings and jeopardize a modification that saves you 42% each and every year? If the company that you go with (the cheapest) allows claims to go on and on, unimpeded, it will destroy your modification almost immediately. Claims from one year will affect your premium for up to 3 years. The running life of these claims is effectively 4 years.
The cheapest carriers may cut costs by eliminating various services, like effective cost containment in their claims division, in order to provide you with the lowest possible pricing. This elimination of services will adversely effect the cost of your claims, which will drive your modification higher in the long run.
So that one year’s 10% savings may end up costing you tens of thousands of dollars in premium over the life (3 year calculation period) of the claims costs generated that particular year. In a nutshell, I recommend that you take a long-term perspective regarding your total costs when making your California Workers Compensation Insurance buying decision.