Get or Renew a Minnesota Assigned Risk Workers' Compensation Insurance Policy With Only a 10% Down payment
Normally, the Minnesota Assigned Risk Plan (also known as the "Workers's Comp Pool") policies require at least 35% down, and up to 100% of the estimated total annual premium at the time of binding the policy.
For many employers, especially those in the Assigned Risk Plan, that's simply not possible, and for almost all Minnesota employers, it creates a cash-flow obstacle.
New businesses especially find the super large premium deposits challenging when there's so many other places those dollars need to go to grow the business.
If you're an employer with an annual workers' compensation premium between $2,000 up to $10,000, a full 50% of the insurance premium deposit is required before the policy even starts. That's the same as paying six months of insurance before the employees punch in for the first day of the insurance policy.
If you're an employer with an annual premium over $10,000, you don't have it much better, the minimum deposit required is 35%, and then you'll make eight monthly payments.
I have a much better solution that will help with your cash flow and allow you to use those dollars where they will work much harder and efficient for you.
Instead of the normal high deposits, I have a solution where you'll receive the following benefits:
10% deposit down to start the policy, even the state assigned risk pool plans.
Pay-as-you-go for the rest of the year. In other words, you'll make workers' comp payments when you pay your employees, which effectively changes the timing of your payments from before the work starts, until after the work is finished. That's just awesome from a cash-flow perspective.
The easiest end-of-the-year workers' compensation insurance policy audits ever. Your audit will be as easy, or easier than any you've had before.
No end of the year surprise bills demanding more premium because you underestimated your payroll.
If you don't have as much payroll, your cash isn't tied up all year as a premium deposit
You don't have to change your insurance carrier, but you can count on us to seek a better value to lower your insurance cost.
Any size account is welcome
If you're taking high-interest rate loans, tying up what may already be limited lines of credit, you'll free up your credit for other uses and maybe save some money in the process.
As you can already easily tell, there's a whole host of attractive benefits. And if you're like most employers seeking a better solution than massive down payments on their workers' compensation polices every year, I'll describe the process next.
How it works:
If you don't already have a workers' compensation insurance policy, albeit are hiring, we'll seek out the options available. If we can place your coverage within the voluntary market, we'll do that first as that's almost always the lowest cost option. If not, we'll apply and place your coverage with a policy in the assigned risk plan (the pool).
If you already have a policy, we'll review it for accuracy, and attempt to find a market with a better insurance value for you. We have a fair amount of success taking assigned risk plans out of the pool, and into the voluntary market. Changing a workers' comp plan from the pool to the voluntary market will often lead to 5% -10%, or more, in insurance savings. If you have a plan in the assigned risk pool, and we can't locate a voluntary plan, we'll have you sign an Agent of Record (AOR)/Broker of Record (BOR) change form. You'll receive the benefits of having 1 Reason as your broker of record.
Next we'll secure insurance premium financing for your policy and present the offer to you for your review.
Here's where it gets really good. Unlike most insurance premium financing with double digit interest rates, you can expect an interest rate offer under 6.9%. The interest rate is so low and competitive, that even if the employer can write out a check for the deposit, many choose not to because they can make those dollars work harder somewhere else.
The employer approves the loan, and the financing company funds the insurance carrier for the policy.
The employer (or payroll provider) enters each period's payroll and an authorized ACH payment is withdrawn directly from their bank account for each pay period. Paying for a policy this way is commonly called pay-as-you-go workers' compensation. This can be setup to automatically happen when you process your payroll, making the entire process easier and a big time saver.
And it gets easier and less time consuming because after the last payroll of the policy term, there's no traditional audit with a payment due or money returned because the amount is known, and been paid for. This is assuming that you'll use the original 10% deposit for the next policy period and your payroll remains the same. Otherwise, the next period is adjusted appropriately.
Rinse and repeat in the next policy period.
When you use 1 Reason's payroll service (find out our latest pricing here), we set it up on auto-pilot for you. Once you approve the payroll and pay your employees, the amount owed for workers' comp is automatically calculated, and the premium is automatically taken out via ACH as described above. No extra steps are required and you'll realize the savings and efficiency of you and your money working smarter, not harder for the same result.