issue no.8 spring 2016 31
verpayment of a “love to hate”
Whilst insurance is a ‘must have’ that some Australian’s love to hate, clever questions can unlock a treasure trove of savings. Many Aussie businesses are paying between $10,000 and $100,000 more than they need to on their Workers Compensation premiums and claims, simply because, like most insurance policies, the devil is in the detail. There are simple ways to minimise both the upfront premiums as well as the often costly process of managing a claim. Some insurance agents offer businesses the basics, with little or no customization.
Protection An important part of the Australian working landscape, Worker’s Compensation Insurance not only protects employees in the event of accident or injury and saves many from financial ruin if forced out of the workforce, but also insures a business against the cost to support the injured workers as they recover from injuries sustained in the workplace. When taking out such a policy, business owners can unwittingly pay too much for their Worker’s Compensation Insurance, either
because they don’t know the best questions to ask their insurance agent, or the agents themselves are less than diligent when establishing the relevant policy detail
Compounded Problems Doubling the financial pain of the policy can be a bi-product of mounting a claim. Once a claim is ‘live’, many businesses are equally unaware of the impact their actions and can have on both the handling and resolution of the claim, and the knock on effect to the premium increase as a result. Business owners’ lack of awareness of the positive impact of better engagement and communication with their workforce on both avoiding workplace injuries or becoming embroiled in a messy claims process, lead to businesses copping a rough deal, read “incurring unnecessary costs,” when it comes to insurance.
Experience Shows One of the first steps in the process is the accurate creation of the policy from the outset, based on relevant business circumstances, and it is at this early stage, that some businesses go wrong. The author, as an independent expert in Workers Compensation policies, sees first hand the
disingenuous practices of insurance agents whilst supporting Aussie businesses to ensure their policy and the premiums are accurate. Experience over 17 years in the industry, has revealed: •
70 per cent of Aussie businesses are overspending on their Worker’s Compensation Insurance.
Insurers sometimes “hide” the laws that are key to a business owner saving money.
Annual overspend amounts ranged from $10,000 to over $100,000
The most common shortfall of Workers Compensation insurance policies has been insurance agents not stipulating to business owners what they are entitled to with regards to reducing premiums.
Classification There are literally hundreds of industry classification and varied premium rates. If an insurance agent makes one or two assumptions about the business, or overlooks basic questions which are able to correctly classify a business, then there is risk it will be classified incorrectly which potentially costs the company hundreds of thousands of dollars in unnecessary premiums.
Spark Magazine Spring 2016 The fuel for business