Pay-As-You-Go Workers Compensation
By Rob Basso
Advantage Payroll Services
At year end, businesses are closing out the books for 2012 and reviewing budgets for 2013, trying to alleviate any burdensome payments that often couldn’t come at a worse time. One common, large expense is Worker’s Compensation payments. Do your clients include their Workers Compensation in one lump sum? Wouldn’t they rather ease that burden and pay one payroll period at a time? With Advantage Payroll’s partnership with Integrated Coverage Group, they can increase your monthly cash flow with our Pay-As-You-Go workers compensation program.
After having a conversation with several clients, and on a whim, calling several more to investigate, I was surprised how many of my small business clients didn’t realize that a convenient, more financially manageable solution existed. With a normal policy, employers have to put 25% down and make large quarterly payments. Pay-As-You-Go workers compensation programs are designed to increase cash flow while helping to minimize large, unexpected payments following a premium audit. There’s no additional charge for adding their premium to their payroll processing, no need to manually input data separately from their payroll reporting, and no installment billing fees.
Below you’ll find a list of the most commonly asked Workers Compensation question that we receive with the answers. I hope this will shed some light on the many questions I’m sure you have on how this can change the way your clients pay for their Worker’s Compensation policy. Don’t forget, the entire staff at Advantage Payroll Services is here to answer any questions you have on any of our products and services. It’s our pleasure to continue to help you and your clients streamline all your small business needs and we are honored to be your resource.
To provide you with more information, I’ve included a few of our most frequently asked questions and answers below. If you have any further questions, please ask your Customer Service Representative or respond to this email.
Rob Basso, President
Q & A Portion
1. What is Pay-As-You-Go Worker’s Compensation?
A Pay-As-You-Go workers compensation policy allows you to simplify insurance payment processing as well as year-end audits by using real-time payroll data transmitted directly from Advantage Payroll. The Pay-As-You-Go policy calculates insurance premium each payroll period based on actual payroll reported which eliminates the need for estimated payroll.
2. How does it work?
Your workers compensation carrier is in direct contact with Advantage Payroll through an automated system which allows them to see the exact payroll you run each pay period. The insurance carrier will charge you each pay period for premiums incurred based on wages paid.
3. How is “Pay-As-You-Go” Workers Compensation different from a traditional policy?
The “Pay As You Go” Program eliminates the necessity of a significant down payment at the beginning of each policy period. It also offers you the convenience of eliminating a premium audit at the end of the policy period. Many Advantage clients find that these features are very beneficial with regards to their cash flow.
4. What are the benefits to switching from a traditional policy?
Transitioning to a Pay-As-You-Go workers compensation policy affords you the following benefits:
- Better Cash Flow Management
- No Large Down payment
- No Need to Manually Input Data Separately From Your Payroll Reporting
- No Installment Billing Fees
- Accurate premium calculation based on current payroll — no estimating.
- No checks to write or monthly billing fees.
5. What is the additional cost for the “Pay As You Go” feature?
No additional cost! There is no cost to you to have the convenience and benefits of this type of workers compensation plan.
6. What will happen to my current Workers Compensation policy if I switch to “Pay As You Go”?
In most cases we can transition your current “traditional” workers compensation policy to a “Pay-As-You-Go” policy by completing a simple one-page application.