Current Work Comp Market Allows Businesses to Plan for Inevitable Increases
California businesses breathed another sigh of relief when the announcement came that workers’ compensation rates would decrease again for 2007. But, smart business owners know the cyclical nature of the California Workers’ Compensation system and are asking the question…How do we take advantage of the current marketplace and prepare for future increases?
Consider three ideas as you align your short and long term risk finance strategies:
Think safety.
The best way to keep pricing minimized over the long term is to keep workers’ comp claims under 65% of premiums paid. Take advantage of current premium discounts and reinvest in safety programs.
Shop smart.
Current competition has created many pricing advantages. However, selecting a carrier on price alone could lead to trouble. During the last soft market a decade ago, many overly aggressive carriers became insolvent after trying to capture big market share. Make sure you carefully consider a carrier’s rating as well.
Stop chasing the market.
Alternative risk finance is becoming a mainstream way move your risk away from the cycles of the traditional market. No longer is alternative financing a tool exclusively for the Fortune 500. More medium sized businesses are saving money by using privately held insurance companies to satisfy their coverage needs.
The best risk finance strategy is one that is customized to match your specific business objectives. Orion’s technical experts are available to help you evaluate your current risk strategy. Please click or call for more information.
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Health Insurance Costs Outpace Wages and Inflation
The cost of employer-paid health insurance rose again in 2006 outpacing both inflation and wages. While insurance providers and California lawmakers work to slow this trend, consumers are left to shoulder the cost.
Employers do have options. “We have clients who this year were able to lower their costs and increase employee satisfaction with the plans they offered,” reports Hunt Turner, an Orion Benefits Consultant. “We can help create benefit strategies that motivate employees to improve their health and reduce their rate of consumption.”
Consider these ideas to help control your forecast as you plan your benefits strategy:
Create a healthier workforce.
Employers showing fewer claims get better rates. Wellness Programs are a great way to lower your health insurance costs by improving the health of your population. These programs can be built to suit your specific needs and are typically very popular with employees.
Give employees ownership.
People are smarter healthcare consumers when they use their own money to pay for a portion of care. This is the foundation of consumer driven health plans that aim to reduce year over year inflation while creating wealth and tax benefits for employees.
Provide options that fit needs.
“One size fits all” healthcare is expensive. Many employers shed costs by offering a variety of plan/contribution combinations. An innovative contribution strategy paired with a multi-plan design can create savings by scaling costs to consumption.
Employers should not rely on insurance companies or lawmakers to maintain cost. Instead, position yourself for better pricing. Orion’s technical experts are available to help you evaluate your benefits strategy. Please click or call for more information.
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