How are workmans compensation premiums calculated?
Workman’s comp insurance premiums are generally determined by the workman’s comp classification your business receives and the degree of hazard that is associated with that classification. Each classification is assigned a rate or loss cost, based on insurer experience with that business type, which strongly affects a business’s final premiums. Consequently, it’s essential that companies receive the correct classifications, of which there are some 600. A company’s safety record also affects a company’s workman’s comp premiums. If an insurer finds a company’s record is better than the industry average after performing a risk evaluation, the business’s premiums could be reduced. If its record is worse than the average, the reverse can happen.
