Anniston, AL, was known for the reliability of its iron furnaces during the civil war. This 21,770 resident town can be a great place to lay down roots. If you're looking to run a business with employees, you'll need to know about workers' compensation insurance.
Since coverage can be tricky, get the help of a professional. An independent insurance agent knows the laws that govern this state-mandated policy and can find coverage that fits. Connect with a local expert to begin.
What Are the Basics of Workers' Compensation Laws in AL?
The city of Anniston has the same laws as the rest of the state concerning workers' compensation. Alabama requires you to carry coverage when you employ five or more full- or part-time employees. While you may not have that many team members yet, you may want to consider a policy even if you have only one employee.
Workers' compensation insurance will pay for medical expenses and lost wages of an employee injured on the job. You'll be liable as a business owner, and that could impact your bottom line. To avoid financial ruin, consider consulting with a professional.
Where Can You Purchase Coverage in Anniston, AL?
In Anniston, AL, you'll have three options of where to get your workers' compensation insurance. Like other business policies, you'll have a choice. Check out the different ways you can comply with state law:
- Get coverage through a private market that select licensed agents are approved to sell. These policies comply with local regulations and have the help of a professional.
- You can group self-insure. You'll pool your resources with other eligible employers to offer coverage. You have to meet specific financial requirements to be approved.
- When you run out of options and two or more carriers decline to write coverage, then you'll have the assigned risk market. This is a pool of companies that will offer a steeply-priced policy until you get the experience needed to go to the private sector.
How experience modification rating affects your premium in Alabama
If your business in Anniston, AL, has a workers' compensation premium of $10,000 or more in two years, you'll have an Experience Modification Factor (X-mod). An X-mod lets company underwriters know how likely you are to file a claim based on your history and other business's histories in the same industry. It works like this:
- When you have an X-mod of 1.0, it doesn't affect your premium. Every employer will start with a 1.0 X-mod, and it's the baseline.
- When you have an X-mod greater than 1.0, it is considered a debit mod. That means you had losses, and your premiums will increase.
- When you have an X-mod less than 1.0, it is the credit mod. This is the best spot because your loss history was better than expected, and you get lower premiums because of it.
What Does Workers' Compensation Cover in Anniston, AL?
Workers' compensation insurance will help your company stay financially sound. When you need to pay for an employee injury or illness, costs could rack up fast. Check out what a workers' compensation policy can cover:
- Disability insurance
- The death benefit to a surviving family
- Lost wages
- Medical expenses
The state of Alabama regulates coverages for your employees. Some guidelines need to be met to have the right policy. To avoid fines and penalties, you'll want insurance that lasts.
Who Does Workers' Compensation Cover in Anniston, AL?
Workers' compensation is meant to insure anyone that might work for your business. That includes coverage for individuals you may not expect. Take a look at some of the people your workers' compensation policy can insure:
- W-2 employees
- Non-exempt owners, partners, members, and officers
- 1099 contractors
Contrary to popular belief, your workers' compensation policy will apply to 1099 contractors. To ensure that a contractor doesn't file a claim on your workers' compensation, general liability, or commercial auto insurances, require them to show proof of coverage. When you mandate a certificate of insurance from your 1099 workers, their policies will fall primary, and yours will be off the hook.
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How Much Does Anniston, AL, Workers' Compensation Cost?
Different from your other policies like general liability or health insurance, workers' compensation is assigned a base rate per duty. Every $100 in payroll in Anniston, AL, is rated per job type. The price will depend on how risky your operation is. The lowest base rate in Alabama starts at $0.15 and goes up to $22.80. Check out some items the companies consider when deciding your costs:
- Classification codes: Each job duty is assigned a class code. The riskier the task, the more you'll pay.
- Loss history: The frequency and longevity of your claims will affect your costs. The more losses you incur and the longer they're open will determine your rates.
- Experience level: The longer you've been in business with workers' compensation coverage, the better premiums you'll get.
Alabama base rate examples
The National Council of Compensation Insurance (NCCI) sets the base rates per classification code. There is a range of rates in each job duty. What you are charged within that base rate will be dependent on the carrier's discretion. Check out some examples of base rate ranges per $100 of employer payroll:
- 8742 Sales professional - $0.25 low rate / $0.62 high rate
- 8810 Clerical-office employees - $0.15 low rate / $0.27 high rate
- 5022 Masonry construction - $5.17 low rate / $12.79 high rate
- 5102 Door and window installers - $3.58 low rate / $8.85 high rate
- 5183 Plumbing contractors - $2.04 low rate / $5.04 high rate
- 5190 Electrical work-electrician - $2.18 low rate / $5.39 high rate
Most Common Workers' Compensation Claims in Alabama
The most common injuries reported are slips and falls and lacerations when it comes to workers' compensation insurance. There have been 643.48 million dollars in benefits paid through state and federal workers' compensation programs. Take a look at the top items that will help reduce injury or illness on the job site:
- Hold regular safety meetings with staff
- Assign a safety officer to keep guidelines monitored and abided by
- Be proactive in workplace safety measures to avoid injury or illness
- Have posted safety protocols for all to see and follow
- Have a risk consultant review all your business policies for safety measures that should be taken
How an Anniston, AL, Independent Agent Can Help
Workers' compensation insurance can be easy to mess up when you're not in the industry. Your business needs a licensed professional who knows local regulations. An independent insurance agent can help you find a policy that meets the criteria and complies with state law.
They have a network of multiple carriers, giving you options on policy and price. Since they work on your behalf, you can put your time to better use. Connect with a local expert on TrustedChoice.com in minutes.
TrustedChoice.com Article | Reviewed by Jeffrey Green
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