“Solutions are found in the details.” That’s a powerful statement if you think about it and it certainly applies to the kind of work we do as a consulting firm.
Most workers compensation premium problems are related in some form or other to employee classification, re-classification, mis-classification, audit, claim or experience rating. You’ll find that these broad topics are twisted up with each other in an intermingled hodge podge of rule driven details.
I’ve been told in the past that a reader should always beware when they see a sentence begin with the word “normally.” Used as a qualifier, this word may be interpreted by some as applying to their individual situation, when in fact it’s case specifics that count. It seems we often use that word when carrying on a discussion about workers compensation issues because, after all, isn’t that all we can do until we know the details?
We’ve worked many client cases faced with similar facts only to discover that some significant specific detail turned out to be the solution for our clients problem.
Classification code issues present a special set of problems. It’s pretty simple to classify a business properly when there’s a specific class code that in fact describes the business operation. Think “shoe store.” Not much wiggle room there right? If you’re in the business of selling shoes from a store front then the “shoe store” class code would “normally” apply. Darn! There’s that word again! But what if you derived most of your sales from the internet? Or what if you derived all of your sales from the internet? Would a different class code apply? Would that code be more or less costly?
Audits pose a different, but similar set of problems. Does your insurance company really know what you do in your business? An experienced workers compensation insurance agent will communicate a great deal of information about your company to the insurance company underwriter with the goal of determining the proper classification for your operation. But until an insurance company either performs an inspection, asks the appropriate rating bureau or advisory organization to perform an inspection or conducts a physical audit of your business they can only be as accurate as the initial information presented. Audits are an opportunity for the insurance company to get their eyes on your operation. Sure audits are chocked full of rating payroll information and classification code verification. Sometimes the information gathered during an audit is misinterpreted resulting in incorrect additional premium bills and threats of collection.
So if you’re reading a blog about workers compensation be sure to watch out for the word “normally.” And remember, in our line of work, workers compensation consulting, it’s always about the details!
Hope this helps you out and thanks for reading!