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6 Tips to Save Money on Your Workers’ Comp Insurance

Wednesday, July 27, 2016   (0 Comments)
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  By Thomas J. Phelan, CPA
President and CEO
Chesapeake Employers’
Insurance Company


In today’s challenging economy, businesses continue to look for ways to save money on their bottom line. One often overlooked way to do this is to focus your efforts on workplace safety and injury management.

A workplace safety and injury management program can help prevent accidents in your workplace. And preventing on-the-job accidents not only reduces injuries and fatalities, but can also help you save money on:

• Work comp and medical insurance costs;
• The cost of conducting accident investigations;
• The cost of replacing and retraining employees; and
• The cost of fines for violating state or federal industry regulations.

And these are just some of the direct costs associated with on-the-job accidents. There are a host of indirect costs associated with them as well.

The case for workplace safety and health is so strong, in fact, that Dr. David Michaels, Assistant Secretary of Labor for OSHA, recently stated: “For every dollar spent on an injury and illness prevention program, [employers] can expect [to see] up to six times a return on their investment.” (Remarks made at the Voluntary Protection Programs Participant Association’s Annual Meeting, National Harbor, MD, Aug. 25, 2014.)

So, what can you as an employer do to enhance your workplace safety and injury management efforts? These tips have proved effective for many Chesapeake Employers’ policyholders:


  1. Adopt a company-wide safety culture. A commitment to safety from your company’s leadership is the first – and most important – step you can take to reduce accidents and lower your work comp insurance costs. Because a majority of accidents are caused by unsafe behaviors, it is essential for management at all levels to commit to a safe and healthy workplace for all employees.

  2. Employ good hiring practices. A well-organized recruitment and hiring process will ensure better qualified employees and a better fit for you and your employees. Your goal is to hire an all-star employee, not your next work comp claim.

  3. Establish a drug-free workplace. According to the 2013 National Survey on Drug Use and Health, nearly 70% of all adult illicit drug users age 18 or older are employed full or part time. Under Maryland law, Health-General §17-214, employers may test their employees for any legitimate business purpose for the use or abuse of any controlled dangerous substance or alcohol. Chesapeake Employers’ Insurance encourages pre-employment, post-accident, and random drug testing.

  4. Provide safety training at all levels. Safety training is really the key to preventing work-related accidents and injuries. When properly trained, supervisors can set the standard for behavior each day by ensuring all company safety rules and regulations are followed, and employees will know how to prevent accidents by following proper workplace safety procedures.

  5. Establish a prompt injury reporting policy. Prompt injury reporting is a very important step in controlling the cost and duration of your work comp claims. Develop procedures for supervisors and employees to report injuries within 24 hours of the accident. Early intervention helps ensure the best medical outcomes for the injured worker, and helps reduce unnecessary attorney involvement and costly litigation later on.

  6. Establish a return-to-work program. An effective return-to-work program minimizes lost time by encouraging your injured worker to return to work more quickly once he or she is medically cleared to do so. A return-to-work program is a formalized policy that seeks to bring your injured worker back to work in a modified or transitional duty capacity, once cleared by a physician and medically able to do so. This not only helps the injured worker tremendously, but it helps to lower medical and indemnity costs, resulting in savings for your company.

Thomas J. Phelan, CPA, is President and CEO of Chesapeake Employers’ Insurance Company (, the largest writer of workers’ compensation insurance in Maryland.

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