Your New Year Insurance Checklist

| posted in Blog, Newsletter

As 2021 gets underway and while you’re making New Year’s resolutions, you should also resolve to review the state of your business’s insurance program and we’ve made that easy with our new year insurance checklist. The best way to do that is to start by reviewing your enterprise’s activities in the past year and how they may affect your insurance policies in the new year. What you find as you go through the following checklist may surprise you. New Year Insurance Checklist Did your operations change last year? Workers’ compensation and commercial general liability (CGL) insurance premiums are based in…
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California’s COVID-19 Tracking Requirement Challenges Employers

| posted in Blog

SB 1159, signed into law in September, requires that when a California employer “knows or reasonably should know” that an employee has tested positive for coronavirus, it must report that positive case to its workers’ compensation carrier within three business days along with other COVID-19 tracking requirements. There is a lot of ground to cover in these reports and the legislation was passed without much publicity, so many employers may not even know about their obligations. And that could cost them: the fine for non-compliance is $10,000 per incident. The law goes further than merely reporting a positive case: The…
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New Law AB 2257 Adds Independent Contractor Exemptions

| posted in Blog, Newsletter

A new law has come to the rescue of a number of freelance professions by exempting them from the onerous requirements of AB 5, which required most independent contractors to be classified as employees in California. Governor Gavin Newsom on Sept. 1 signed AB 2257 as an urgency measure, so that it took effect immediately after it passed unanimously in both houses of the state Legislature. If you remember, AB 5 set a new standard for hiring independent contractors, requiring many to be reclassified as employees covered by minimum wage, overtime, workers’ compensation, unemployment and disability insurance. It created a…
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More Businesses Get Bills for ‘Misclassified’ Workers Under AB 5

| posted in Blog, Newsletter

One outgrowth of new California law AB 5 that applies more stringent criteria for what constitutes an independent contractor is that many employers are likely to see more audits and calls for additional premium from their workers’ comp insurers. In fact, it’s already happening in some industries, according to the insurance industry trade press. More and more employers are being hit with sizeable surprise bills for additional premium by their insurers for allegedly misclassifying employees as independent contractors, according to one article in the Workers’ Comp Executive trade publication. And this problem is only like to get worse in 2020…
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How to Keep from Hiring a Serial Workers’ Comp Filer

| posted in Blog, Newsletter

As employers have found in the last few years, hiring has become more difficult as the labor market has tightened amid a strong economy. With slim pickings, many firms are having to settle for workers they may not normally hire – but that can lead to issues like higher turnover and workers’ comp fraud. Some employers even have a hard time finding candidates that don’t have substance abuse issues, while some people are serial workers’ comp filers, malingerers or have prior industrial injuries that can end up affecting your bottom line and X-Mod. Here are some suggestions for helping you…
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Newsom Signs Sweeping Independent Contractor Bill AB 5

| posted in Blog, Newsletter

California Gov. Gavin Newsom has signed legislation into law that will codify a court ruling from last year that set new ground rules for what constitutes an independent contractor, and which expands on that ruling. There’s been a lot written in the media about the legislation, AB 5, and unfortunately much of it misses the point. Some news reports have said it will spell the end of independent contractors in the state and that anyone a company hires to do a temporary job on contract must be treated as an employee, along with all of the obligations that go with…
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Workers’ Comp Audit Mistakes: What to Look For

| posted in Blog

No company owner wants to undergo a workers’ compensation audit, but they are a fact of life if you run a business and have employees. Unfortunately, many audits don’t go smoothly and sometimes your insurer may make mistakes. Missouri-based Workers’ Compensation Consultants, which helps employers through the workers’ comp audit process, recently listed the 10 most common audit mistakes that insurance companies make. The list highlights a common problem and how you can detect the mistakes to avoid being stuck with a massive audit bill. Insurance companies allow you to review the audit with your broker. If you notice that…
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New Rule Simplifies X-Mod Calculation, Encourages Reporting First Aid Claims

| posted in Blog, Newsletter

A new method for calculating workers’ compensation experience modifications (X-Mods) took effect in California on Jan. 1, 2019. The Workers’ Compensation Insurance Rating Bureau of California has created a new simplified formula for calculating X-Mods as part of its efforts to add more transparency to the process. The new formula excludes the first $250 of every claim for the X-Mod computation, no matter how large or small the claim is. This also means that if an employer pays, say, $200 for first aid on a minor workplace injury, they are required to report it as a claim. Doing so will…
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Commissioner Approves 10.3% Benchmark Rate Cut

| posted in Blog, Newsletter

THANKS TO the reforms enacted in 2014, California Insurance Commissioner Dave Jones has ordered a 10.3% average mid-year decrease to the state’s benchmark workers’ comp rates. The new benchmark rate, which insurers use as a guidepost to price their policies, will take effect on July 1. The benchmark is essentially the base rates that cover expected costs of claims and claims-adjusting expenses across all worker class codes. Insurers can price their policies as they wish, so there is no guarantee that any particular employers will see rate cuts. When pricing your policy, your insurer will take into account your claims…
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Rating Bureau Recommends Rate Increase, Albeit Slight

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The Workers’ Compensation Insurance Rating Bureau of California will ask for a benchmark rate increase of 0.1% for policies incepting on or after Jan. 1, 2018. But, in light of the insurance commissioner approving a 7.8% decrease for July 1 of this year, the benchmark rate for 2018 policies will still be nearly 8% less than it was at the start of 2017. The change would affect the benchmark rate – also known as the pure premium rate – which is a guidepost that insurers use to price their policies. That said, insurers are free to price their policies as…
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