Rising premiums are making it harder for businesses to obtain workers' compensation insurance on their own, so more are turning to state-run programs.
Advice: Check out coverage offered through an association or chamber of commerce pool. You could find a better deal.
Twenty-four states offer workers' comp coverage to companies that can't find a carrier. Those state-run programs are growing, but profits are sliding. So those states likely will raise rates quickly.
How do association pools work? Employers in similar industries with good safety records and low workers' comp losses band together. Pools can earn group ratings from state and private insurers high enough to merit discounts.
Examples: The Manufacturers Associa-tion of Central New York offers up to a 40 percent discount. The Plumbing Heating Cooling Contractors of California provides members with a 6 percent discount. The Utah Manufacturers Association guarantees at least a 5 percent discount. Check your trade group or local chamber.
Your savings and access to association workers' comp programs depend on where you do business. In some states, including Ohio and Washington, only government entities can write workers' comp insurance. Those states tend toward higher discounts through association pools. In many states, including California, Maryland and New York, workers' comp programs compete with private insurance companies and serve as insurers of last resort. Those states usually offer lower discounts.