As a business owner, your top priority is protecting what you’ve worked hard to build. When it comes to business insurance, it can be tough to know which coverage you need and where to get it.
Often, workers compensation isn’t just helpful coverage – it’s required by law. But you have a choice in the insurance carrier you partner with, and that choice can make a big difference.
Why work comp deserves special attention
You carry a variety of types of insurance coverage to protect your business. Why should you care about work comp?
Work comp premium is a significant line item for many businesses, particularly those in higher-risk industries like construction and manufacturing. And the way carriers calculate your premium is complex. It involves factors like your claims experience, state regulations, payroll, and type of work.
You have opportunities to control costs, but doing so requires proactive management of workplace safety and employee injury claims.
Work comp is different from other insurance lines
Each type of business insurance – general liability, commercial property, auto – protects you in different ways. Work comp stands out as unique for several reasons.
- State-by-state regulations. Work comp requirements vary by state and industry, so even determining whether you need coverage can be challenging.
- Workplace safety plays a big role in your premium and ROI, and safety best practices are unique to every business and industry.
- Employee injuries impact more than your premium. They hurt productivity, morale, and talent retention.
- Complex, long-tail claims. Medical and indemnity payouts can be large and span decades. They also present opportunities for complex litigation.
- The return-to-work process is critical and requires coordination.
These characteristics make proactively managing your work comp policy crucial but challenging.
6 unique advantages of working with a specialized carrier
Work comp’s unique nature also means that big-name multiline carriers are sometimes not equipped to support policyholders through challenges.
For this reason, many businesses choose to get their policy through a specialized carrier instead of bundling it with their other business policies.
Here are six advantages of choosing a specialized work comp partner.
1. Safety and loss control programs
A specialized work comp carrier often has more targeted workplace safety programs than a multiline carrier. That’s because it’s in the carrier’s best interest (and yours) to prevent employee injuries before claims happen.
Specialized carriers often have dedicated safety experts to provide free consulting, including:
- Industry-specific risk analysis
- On-site or virtual safety assessments
- Specific policy, process, and equipment recommendations
Because injury prevention is so important in work comp, some carriers offer incentives for safety.
For example, MEM’s Safety Grant program lets policyholders apply for a grant to buy approved safety equipment. Selected recipients invest their own money, and MEM matches the investment dollar-for-dollar up to $10,000.
We also offer endorsements to help policyholders earn discounts on services like drug testing.
2. Customer service
Calling your insurance company probably isn’t your favorite way to spend your time. When you do have questions or concerns, you hope the first person who answers the phone can answer them.
Working with a specialized carrier lets you skip the generic call centers and speak with a work comp expert right away. The person helping you likely has a deep knowledge of your policy, the applicable regulations, and industry risks.
These carriers also often provide resources and guidance to help you improve safety and your e-mod.
3. Care coordination for injured workers
Because claims have a significant impact on your e-mod and premium, it’s crucial to participate in an injured worker’s care.
A specialized carrier will often assign a nurse case manager to higher-severity claims from the beginning. Their job is to coordinate the employee’s treatment and help you plan for a successful return to work (more on that below).
The nurse case manager helps ensure the employee has the best possible recovery without allowing claim costs to inflate.
4. Return-to-work guidance
Medical care accounts for about half of work comp claims costs. The other half is lost wages (indemnity).
When an injured worker can’t return to work for a long time, it inflates claim costs. It also contributes to worse outcomes for both the business and the employee.
A specialized nurse case manager and/or return-to-work coordinator will help you create a plan for your employee to return to work when they safely can. Often, this includes job demand analysis and transitional duty planning. These are customized strategies you won’t get from a one-size-fits-all approach.
5. Claims management
Work comp claims can be long and complex. While a multiline carrier has coordinators and adjusters for all types of claims, their focus is generally managing large volumes of claims.
A work comp carrier invests in claims handlers who are experts in compensability. They know the right questions to ask to manage your claim properly and comprehensively.
The result is a claims manager who feels like a partner, not an adversary. Their goal is to cover compensable injuries while controlling medical costs, indemnity, and litigation costs. In turn, these strategies help you control insurance costs.
6. Regulation analysis
Work comp is one of the most heavily-regulated lines of business insurance. If changes in state or federal legislation impact your policy, you need to know right away.
Specialized work comp carriers dedicate resources to monitoring changes on the horizon and provide guidance on how to prepare.
At a glance: Specialized vs. non-specialized work comp carriers
| Specialized work comp carrier | Non-specialized carrier | |
| Workplace safety | Uncovers industry-specific safety gaps with targeted recommendations | One-size-fits-all evaluations miss opportunities to reduce risk |
| Loss control | Comprehensive safety audits identify opportunities for improvement | Infrequent or cursory assessments may overlook hazards |
| Customer service | Dedicated work comp experts with deep knowledge of regulations and risk mitigation strategies | Call center staff handling multiple insurance lines may lack nuanced expertise |
| Care coordination | Nurse case managers provide ongoing support and coordination through recovery (sometimes years) | Limited care coordination may delay recovery timeline |
| Return-to-work guidance | Job demand analysis and guidance on transitional duty | Generic one-size-fits-all recommendations, regardless of job type |
| Claims management | Adjusters well versed in compensability help contain legal costs | Volume-focused claims handlers spread thin may trigger litigation |
| Regulation analysis | On top of regulations to provide guidance on preparing for changes | Reactive approach to addressing regulatory shifts |
Do I need a specialized work comp carrier?
With all this in mind, should you choose to work with a carrier specializing in work comp? Only you can answer that question for your business with a careful analysis of the costs and benefits.
Some multiline carriers offer discounts on work comp if you bundle it with your other business insurance policies. This could mean lower premium.
However, this type of carrier often doesn’t have the specialization or unique value-adds to help you get a high return on investment from your work comp premium.
Partner with the experts
Choosing a carrier with bottom-of-the-barrel pricing often comes with a customer experience to match. That’s why smart business owners look at long-term ROI over simple price discounts. For many businesses, partnering with a specialized work comp carrier helps protect their people and build a strong future.
At MEM, work comp is all we do. Discover three reasons policyholders stick with us year after year.