Policies are written for one full year. So if you think
you won't be hiring any employees for the rest of the
policy period, there will be no extra charges added for
payroll beyond the minimum premium as stated in the policy.
The final premium is based on your final payroll figures.
The number of employees is not important. Many contractors,
like roofers, have seasonal busy periods, then times when
there is less of a need for employees. At the policy conclusion
you'll pay the same for having one regular employee when
the payroll comes to $10,000, or if you have no payroll
until the last day then hire thirty guys for one day and
that day's payroll comes to $10,000. (Assuming everything
else is similar.)
The premium quoted to you is for an annual policy, but
it is only an estimate. Look, first, at the rate being
charged per classification (or vocation) like roofing,
finish carpentry, plumbing, etc. To fairly compare different
proposals the total premium is based on your estimate
of total payroll. So the estimated total is nothing more
than a guess of what your final bill might look like.
Rates are stated for each separate vocational class. The
rate can change dramatically if your employees are paid
more than a certain rate (usually around $19 -$21 per
hour.) Sometimes payroll can be structured to take this
into account.
The best time to change to a different company is at its
anniversary date, the expiration date shown on the policy.
It is a complicated and costly procedure to properly cancel
a policy in the middle of its annual term.
Every year you should request a loss analysis statement
to substantiate your record to any possible new insurer.
It is an essential part of good record-keeping. The longer
you maintain a record of few or no losses (without a gap
of time being uninsured) you will find lower and lower
workers compensation premiums being offered to you. The
companies look at those numbers very closely. Look to
see if you qualify for a safety group. Most carriers have
special programs for certain classes of workers.
