The market is shifting, the market is shifting. No the sky isn’t falling but what is occurring could shake your world a bit, if you’re not prepared.
Health Insurance Rates – are going up between 10%-30% for many group plans, cost for some are about $500 per employee per month. Insanity!!
The good news: Creativity pays, HSA and high deductible group plans and self funding can carve out some deals but only if you have over 50 employees, self funding is more in the over 100 employee arena. Also, what you can’t change on this front you can on the package and workers’ compensation savings so it can at least off set this cost.
Workers’ Compensation – a rate increase was approved for January 2011 in California, but what we are seeing is that the cream of the crop most competitive players in the field took some hikes in their rates as early as October 2010. So, if you got a stellar deal last year, chances are they are packing a punch to you this year. The State Fund issued a release they are taking a 5.2% rate increase, which doesn’t sounds so bad except that they are the least competitive carrier we have seen out there. We consistently reduce clients premiums by 50% if they are with the State Fund.
The good news: Four new carriers have emerged into the California market place as they want a piece of this action, whether they will be buying up the business by offering compelling pricing will be seen shortly as we see the December and January figures released. Some carriers we work with have not taken a rate increase and are not planning one for January 2011.
Again, as we have stated before, the way to get the best rates are to strategically market your account. We do this by accessing every market with agents that have the best relationships and exclusive relationships with those carriers. Only 1-3 carriers will provide a “blow the roof off” price quote, and the goal is to find the proverbial needle in the hay stack. Insurance companies HATE what we do, they check out our website and read it page by page. The reason, we drive the cost down and there is not an agent, or other service that accomplishes this task, you can’t over-charge if you have competitive leverage.
Want to find out if you are over-paying for your workers’ compensation right now? What is your clerical rate?
You should be paying no more than .38 per $100 of payroll in California
Now, if you are paying more than .38 for your clerical rate – what is the percentage amount that you are over-paying? Take that amount off your whole policy premium and that is how much you are over-paying.
A perfect science – this is not a perfect science, but it has been pretty darn accurate when we use it with our clients but there are a few rules.
1) Your experience modification should be less than 1.30
2) You should have at least $500k in payroll
3) You should be a somewhat desirable risk. What is a somewhat desirable risk, it is better to state what is not a desirable risk – bomb mfg, toxic waste disposal – think of really tough businesses.
Keep in mind many agents sell their client as a tough risk and they are not –this mentality keeps you locked into them and keeps you from searching out a better option, because they have told you no one wants you. If in doubt of your situation give us a call or email us and we will tell you straight up for free if you’re a candidate for savings.
Are you over-paying? Try our free fast calculator to find out – Calculator