Lower Workers' Compensation Claims
Workers’ compensation insurance is an important and required benefit, in California, that pays employees a portion of their salary when they’re out of work due to an injury or illness sustained on the job. Because of the high direct and indirect costs of claims, companies are naturally looking for ways to reduce their workers’ compensation claims.
How Workers’ Compensation Claims Can Affect Employers
- Increase in Premiums: Workers’ compensation premium calculations are related to your business’s experience modification rate (MOD). This is based on the number of OSHA filings your business has made. If your MOD increases, there’s a good possibility that your workers compensation premiums will increase; especially if your MOD rises above the industry average.
- Additional Wages: You may owe wages to injured workers for any absences not covered by workers’ compensation.
- Loss in Productivity: You may lose productivity related to work rescheduling, new employee learning curves, and/or accommodations for injured employees.
- Costs Related to Work Stoppage: You may need to cover the expense of work stoppage associated with the worker’s injury. Work stoppages may also have long-term impacts on productivity and production costs.
- Overtime Costs: With fewer employees available to work, other members of your labor force will need to fill in the gaps. You may incur overtime costs in order to maintain your regular production.
- Training Time & Expenses: While your injured employee is taking time off for their recovery, you may have to invest additional time and money into training a replacement.
- Cost of Repairs & Damages: If clean-up, repair, and replacement of damaged material, machinery, and property is needed, you’ll have to absorb the additional costs required.
- OSHA & Legal Fees: You may have to pay OSHA fines and any fees associated with legal action.
Our Solution
Cal Commercial Insurance can offer you a choice of insurance products your employees want, at little to no cost to you!
Based on an independent nationwide survey of 1,500 businesses offering one of the products we can recommend, the businesses reported the following.
- 51% said they had seen a decline in workers’ compensation claims
- 40% of those companies reported seeing a significant reduction in workers' compensation claims of 50-74%.
- 34% said they had seen a very significant reduction in workers’ comp claims; a reduction of 75% or more!
Reference: 2016 Aflac WorkForces Report study, conducted by Lightspeed GMI
Retaining Valuable Employees
When companies have fewer than 50 employees, the importance of benefits options extends beyond proving the goodwill of an employer and providing employees with basic medical coverage. Benefits can also help boost the value of your business. When employees are satisfied with their benefits, they’re more likely to be productive and stick around longer, allowing you to retain top talent and keep your business running smoothly without interruption.
Our Solution
Cal Commercial Insurance offers a complete line of insurance and group benefits for employers ranging from group health insurance to life and HRAs. Many businesses today face challenges in attracting and retaining top employees. As a business owner, you know the importance of employee benefits and their contribution to your business success. We will work with you to develop a program tailored to your individual circumstances. These products and services are designed to provide solutions to your personal and business financial needs, including:
- Group Health Insurance
- Group Dental Insurance
- Group Vision Insurance
- Group Life Insurance
- Supplemental Insurance
- Health Reimbursement Arrangement
- Health Savings Account
Benefits Give Small Businesses a Competitive Edge
- 48% of employees would be at least somewhat likely to accept a job offer that included a slightly lower compensation but a more robust benefits package.
- 17% of employees have left a job or turned down a job offer due to the benefits they offered.
- 77% of small businesses employees say their benefits package is at least somewhat important for workplace engagement.
- 79% of small businesses employees say their benefits package is at least somewhat important for work productivity.
- 85% of small businesses employees say their benefits package is at least somewhat important for loyalty to their employer.
- 88% of small businesses employees say their benefits package is at least somewhat important for job satisfaction.
Cal Commercial Insurance is here to help guide you on the best mix of employee benefits to help you retain your valuable employees.
Reference: Independent study conducted by Lightspeed for the 2018 Aflac WorkForce Report
Financial Planning
There is usually one obstacle or another that gets in the way of planning for your financial future.
Big Debt & Little Savings
Debt, particularly credit card debit, is a big concern for many families. In 2017 the total credit card debt owed by consumers was $931 billion. On average, a household carried $15,983 of this type of debt and those with revolving credit card debt pay $904 in interest per year. Are you concerned about the amount you owe?
Additionally, the personal savings rate – personal savings as a percentage of disposable personal income has slipped lower. In March 2017, the rate was 3.9% and as of March 2018 it’s at 3.1 %. Are you’re saving enough?
College Costs
Without proper planning, paying to send a child to college can put a strain on savings. According to the
College Board, the actual cost a student pays college is usually lower than the per-year prices these institutions publish publicly, 
which range from more than $9,410 for an in-state student at a public four-year college to slightly more than $32,000 for a private four-year college.
The organization notes that more than half of full-time students pay $11,814 or less per year for tuition and fees thanks to grants, scholarships and other types of financial aid. Remember, though, that tuition and fees are only part of the cost of college. Students also have to pay for housing, food, books, supplies and other expenses.
It’s also important to plan ahead since the price can increase over time. If you currently have a 1-year-old child, and the of cost college increases by only 3% each year, when he/she reaches college age it could cost $148,304 to send them to a 4-year program at an in-state public college or university.
Retirement Confidence
Only 17% of workers feel very confident they will live comfortably in retirement, while 47% are somewhat confident, per the most recent Retirement Confidence Survey. Yet, a large portion of these workers have little to no money savings or investments: 45% report that the total value of their household’s savings and investments, excluding the value of their primary home and any defined benefit plans, is less than $25,000, including 26% who say they have less than $1,000 in savings.
Social Security
Social Security may not be a reliable source of income in the future. A recent Social Security trustees report noted that the combined trust fund reserves will begin to decline in 2022 until reserves become depleted in 2034. When looked at separately, the Disability Insurance Trust Fund reserves become depleted in 2028 and the Old-Age, Survivors, and Disability Insurance Trust Fund reserves become depleted in 2035.
Rising Cost of Living
Often people fail to consider the rising cost of living when creating a strategy for their future. To show how this can affect you, consider this: If you and your spouse are each 45 years old, earn $100,000 per year and plan to retire in 20 years and inflation averages 4.5% during the next two decades, you will need more than $241,000 a year to equal your current $100,000 annual income.
Unexpected Loss
If you should die unexpectedly, without proper planning that includes life insurance and/or emergency savings, your family could face serious financial issues due to funeral costs, credit card bills, mortgage costs, education tuition and more.
Our Solution:
Your Financial Needs Analysis
Cash Flow
- Earn additional income
- Manage expenses
Debt Management
- Consolidate debt
- Strive to eliminate debt
Emergency Fund
- Save at least 3-6 months’ income
- Prepare for unexpected expenses
Proper Protection
- Protect against loss of income
- Protect family assets
Build Wealth
- Strive to outpace inflation and reduce taxes
Preserve Wealth
- Reduce taxation
- Build a family legacy
When investing, there are certain risks, fees and charges, and limitations that one must take into consideration.
How Much Life Insurance Do You Need?
The amount of life insurance coverage necessary is different for everyone and is based on a variety of factors including your:
- Age
- Health
- Number of dependents
- Income/current financial situation
Based on these considerations, a basic rule of thumb is to have enough life insurance to provide about 10 times your annual family income. For example, if your current household income is $50,000, you may want to consider having $500,000 in life insurance protection.
But there are many variables that can affect your life insurance needs.
Consider these questions:
- How much long- and/or short-term debt do you have?
- What are your long-term goals?
- How much of the insured’s income will be needed and over how many years?
- How much do you want to set aside for funeral costs and/or an emergency fund?
- What assets do you have that may be able to cover these costs?
To ensure that you have the right type and amount of insurance, make sure to consult with an experienced life insurance professional at Cal Commercial Insurance for a thorough evaluation of your needs.
References:
- “2017 American Household Credit Card Debt Study,” Erin El Issa, NerdWallet.com, https://www.nerdwallet.com/blog/average-credit-carddebt-household/, May 2018.
- U.S. Personal Saving Rate, YCharts.com, https://ycharts.com/indicators/personal_saving_rate, May 2018.
- “College Costs: FAQs,” The College Board, May 2018.
- College Cost Calculator, The College Board.
- 2018 Retirement Confidence Survey, Employee Benefits Research Institute and Greenwald & Associates, April 24, 2018.
- 2018 RCS Fact Sheet #3, Preparing For Retirement In America, Employee Benefits Research Institute and Greenwald & Associates, 2018.
- The 2017 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Federal Disability Insurance Trust Funds, July 13, 2017.