Comments on: A Primer on Workers Comp. http://www.coyoteblog.com/coyote_blog/2004/10/a_primer_on_wor.html Dispatches from a Small Business Sun, 12 Feb 2012 09:39:47 +0000 hourly 1 http://wordpress.org/?v=3.2.1 By: Richard http://www.coyoteblog.com/coyote_blog/2004/10/a_primer_on_wor.html/comment-page-1#comment-54 Richard Sat, 29 Jul 2006 22:08:03 +0000 http://coyote-blog.com/wordpress/2004/10/a_primer_on_wor.html#comment-54 <p>PEOs are the worst thing that has ever happened to the construction industry. First, they only provide half the coverage of a standard work comp policy, as they specifically exclude any lower tier subcontractors or suppliers. Construction is a tiered industry - period. There is no such thing as not having lower tiers in construction unless you happen to be the last materials supplier in the sub-sub line. This forces the contractor/subcontractor to procure an additional work comp policy in their company's name, called a minimum premium policy. They don't tell the clients in the construction industry this, though, when they are signing them up. In FL, the only source for a minimum premium policy is through the JUA. Not only that, PEOs have enough conditions for what constitutes the account being "in good standing," that the accounts are never in good standing and they deny the claims. Add to that the problem of the employers liability no longer being included on the umbrella policy because the contractor no longer has a work comp policy in their name. PEOs should be banned from the construction industry unless they either issue A rated work comp policies in the contractors name (NOT the alternate employer endorsement, which allows NO more protection for a GC or CM from a subcontrator's lower tiers), or require them to provide the minimum premium policy from an A rated company. PEO and Crook are synonymous in my book.</p> PEOs are the worst thing that has ever happened to the construction industry. First, they only provide half the coverage of a standard work comp policy, as they specifically exclude any lower tier subcontractors or suppliers. Construction is a tiered industry – period. There is no such thing as not having lower tiers in construction unless you happen to be the last materials supplier in the sub-sub line. This forces the contractor/subcontractor to procure an additional work comp policy in their company’s name, called a minimum premium policy. They don’t tell the clients in the construction industry this, though, when they are signing them up. In FL, the only source for a minimum premium policy is through the JUA. Not only that, PEOs have enough conditions for what constitutes the account being “in good standing,” that the accounts are never in good standing and they deny the claims. Add to that the problem of the employers liability no longer being included on the umbrella policy because the contractor no longer has a work comp policy in their name. PEOs should be banned from the construction industry unless they either issue A rated work comp policies in the contractors name (NOT the alternate employer endorsement, which allows NO more protection for a GC or CM from a subcontrator’s lower tiers), or require them to provide the minimum premium policy from an A rated company. PEO and Crook are synonymous in my book.

]]> By: PEO Advisor http://www.coyoteblog.com/coyote_blog/2004/10/a_primer_on_wor.html/comment-page-1#comment-53 PEO Advisor Fri, 02 Jun 2006 20:30:47 +0000 http://coyote-blog.com/wordpress/2004/10/a_primer_on_wor.html#comment-53 <p>Meredith,</p> <p>Your comments about PEOs are not quite accurate. In fact many PEOs aggressively manage work comp claims. Why? Because a work comp claim goes against the PEO's experience and could affect its ability to compete. This is one of the greatest benefits of a PEO. Each PEO has a department that will manage each claim, working to find a quick resolution. These efforts will inevitably result in a much lower claim cost. Many insurance companies would just pay the claim and re-rate the client’s mod.</p> Meredith,

Your comments about PEOs are not quite accurate. In fact many PEOs aggressively manage work comp claims. Why? Because a work comp claim goes against the PEO’s experience and could affect its ability to compete. This is one of the greatest benefits of a PEO. Each PEO has a department that will manage each claim, working to find a quick resolution. These efforts will inevitably result in a much lower claim cost. Many insurance companies would just pay the claim and re-rate the client’s mod.

]]> By: Marshall Carr http://www.coyoteblog.com/coyote_blog/2004/10/a_primer_on_wor.html/comment-page-1#comment-52 Marshall Carr Wed, 08 Feb 2006 16:46:02 +0000 http://coyote-blog.com/wordpress/2004/10/a_primer_on_wor.html#comment-52 <p>PEO's - aka Employee Leasing Companies are not always the best solution for an employer that feels that they are paying too much for workers compensation coverage.</p> <p>Most insurance carriers will not write Workers Compensation coverage for PEO's. The reason being is because the insurance company can not control the risk. A loss control representative (sometimes called a safety engineer) can not make a direct impact on the safety of the PEO because the risk is spread out among many, many employers. This in turn causes underwriters to fear PEO's. If a PEO has truckers, contractors, and other higher risk industry groups in their customer group; they have even more difficulty finding coverage.</p> <p>The result is that PEO's get charged some of the highest rates insurance companies can offer.</p> <p>Some PEO's try to convince employers that they can save them money because they will drop their own modification factor (x-mod) take on the PEO's x-mod. This may benefit an employer that has a high x-mod (>1.25). However, as history has shown time after time, PEO's that take on customers with high x-mods eventually fail. They fail because the PEO's x-mod will go up and they are no longer a cost saver. Thus losing all their customers.</p> <p>If you decide to use a PEO, you should make a thorough analysis of the PEO's x-mod history. If the PEO will not share this with you - stay away. If you see the x-mod steadily climbing - stay away. If the PEO has not been in business long enough to have an x-mod history - stay away - or you may get burned in the long run.</p> PEO’s – aka Employee Leasing Companies are not always the best solution for an employer that feels that they are paying too much for workers compensation coverage.

Most insurance carriers will not write Workers Compensation coverage for PEO’s. The reason being is because the insurance company can not control the risk. A loss control representative (sometimes called a safety engineer) can not make a direct impact on the safety of the PEO because the risk is spread out among many, many employers. This in turn causes underwriters to fear PEO’s. If a PEO has truckers, contractors, and other higher risk industry groups in their customer group; they have even more difficulty finding coverage.

The result is that PEO’s get charged some of the highest rates insurance companies can offer.

Some PEO’s try to convince employers that they can save them money because they will drop their own modification factor (x-mod) take on the PEO’s x-mod. This may benefit an employer that has a high x-mod (>1.25). However, as history has shown time after time, PEO’s that take on customers with high x-mods eventually fail. They fail because the PEO’s x-mod will go up and they are no longer a cost saver. Thus losing all their customers.

If you decide to use a PEO, you should make a thorough analysis of the PEO’s x-mod history. If the PEO will not share this with you – stay away. If you see the x-mod steadily climbing – stay away. If the PEO has not been in business long enough to have an x-mod history – stay away – or you may get burned in the long run.

]]> By: Merideth Carleton http://www.coyoteblog.com/coyote_blog/2004/10/a_primer_on_wor.html/comment-page-1#comment-51 Merideth Carleton Tue, 15 Nov 2005 00:58:45 +0000 http://coyote-blog.com/wordpress/2004/10/a_primer_on_wor.html#comment-51 <p>Have you seen this before? It's a number guessing game: http://www.amblesideprimary.com/ambleweb/mentalmaths/guessthenumber.html. I guessed 58664, and it got it right! Pretty neat.</p> Have you seen this before? It’s a number guessing game: http://www.amblesideprimary.com/ambleweb/mentalmaths/guessthenumber.html. I guessed 58664, and it got it right! Pretty neat.

]]> By: Jasen http://www.coyoteblog.com/coyote_blog/2004/10/a_primer_on_wor.html/comment-page-1#comment-50 Jasen Mon, 14 Nov 2005 16:52:53 +0000 http://coyote-blog.com/wordpress/2004/10/a_primer_on_wor.html#comment-50 <p>Using a P.M.L. Worldwide member PEO Company, or Employee Leasing Company, makes leasing employees a cost-effective convenience for any small business owner. The reductions in cost are made possible through volume discounts by pooling your company's employees together with P.M.L.'s for worker's compensation, health, dental, vision and life insurance benefits, state taxes, S.U.T.A. taxes, federal taxes, etc. P.M.L. clients' paperwork hassle and time consuming follow up are reduced, and sometimes eliminated, because P.M.L. does the work for them. All payroll related taxes, filings and reports are also handled by P.M.L., leaving the business owner free to take care of the things he or she went into business for... Making A Profit! Please feel free to visit PML Worldwide HERE or call 800-567-0235 ext. 201 for more information.</p> Using a P.M.L. Worldwide member PEO Company, or Employee Leasing Company, makes leasing employees a cost-effective convenience for any small business owner. The reductions in cost are made possible through volume discounts by pooling your company’s employees together with P.M.L.’s for worker’s compensation, health, dental, vision and life insurance benefits, state taxes, S.U.T.A. taxes, federal taxes, etc. P.M.L. clients’ paperwork hassle and time consuming follow up are reduced, and sometimes eliminated, because P.M.L. does the work for them. All payroll related taxes, filings and reports are also handled by P.M.L., leaving the business owner free to take care of the things he or she went into business for… Making A Profit! Please feel free to visit PML Worldwide HERE or call 800-567-0235 ext. 201 for more information.

]]> By: Greg Arnold http://www.coyoteblog.com/coyote_blog/2004/10/a_primer_on_wor.html/comment-page-1#comment-49 Greg Arnold Sun, 04 Sep 2005 04:04:22 +0000 http://coyote-blog.com/wordpress/2004/10/a_primer_on_wor.html#comment-49 <p>That was explained extremely well. If you plan on delving any deeper into work comp, please list PEO's as another valuable source for work comp insurance. PEO's - aka Employee Leasing Companies - are payroll companies with the added benefit of "pay-as-you-go" workers comp insurance. PEO's extend their master policy to their client companies, and therefore they pay / manage claims. There are no deposits and audits are rare. Some PEO's offer free risk management to their client companies as a proactive approach to MOD management. Some PEO's cater to a broad spectrum of industry, while others serve a niche, like construction, for example. PEO's generally require an applicant company to provide an underwriting application (or standard work comp Acord application), & loss runs (or an affidavit from the owner testifying to loss history); submissions generally take a week or less to underwrite, and in some cases will underwrite in a day if a client has just been notified of cancellation and is facing a lapse in coverage.</p> That was explained extremely well. If you plan on delving any deeper into work comp, please list PEO’s as another valuable source for work comp insurance. PEO’s – aka Employee Leasing Companies – are payroll companies with the added benefit of “pay-as-you-go” workers comp insurance. PEO’s extend their master policy to their client companies, and therefore they pay / manage claims. There are no deposits and audits are rare. Some PEO’s offer free risk management to their client companies as a proactive approach to MOD management. Some PEO’s cater to a broad spectrum of industry, while others serve a niche, like construction, for example. PEO’s generally require an applicant company to provide an underwriting application (or standard work comp Acord application), & loss runs (or an affidavit from the owner testifying to loss history); submissions generally take a week or less to underwrite, and in some cases will underwrite in a day if a client has just been notified of cancellation and is facing a lapse in coverage.

]]> By: Accidental Verbosity http://www.coyoteblog.com/coyote_blog/2004/10/a_primer_on_wor.html/comment-page-1#comment-55 Accidental Verbosity Mon, 18 Oct 2004 10:02:25 +0000 http://coyote-blog.com/wordpress/2004/10/a_primer_on_wor.html#comment-55 <strong>Carnival of the Capitalists Anniversary, Part 2</strong> A year ago, Carnival of the Capitalists was one of the foremost things on my mind. Today, CotC takes second place, at least, as I have a "distraction" I Carnival of the Capitalists Anniversary, Part 2

A year ago, Carnival of the Capitalists was one of the foremost things on my mind. Today, CotC takes second place, at least, as I have a “distraction” I

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