The many different types of insurance a small business owner has to deal with are staggering. One such insurance, worker’s compensation, helps ensure employees who suffer job-related illnesses and injuries receive proper medical care and financial compensation for lost wages. Buying the right workers comp insurance is a crucial step for any business.

Determine State Requirements

Each state has different laws regarding worker’s comp insurance. Always read up on requirements as they may vary drastically for your business type and size. Certain types of workers may be excluded, including:

• Agriculture workers
• Domestic workers
• Seasonal workers

Establish Premium and Policy Costs

Your premiums may also vary greatly depending on your chosen industry. Those considered high-risk, such as industrial businesses, will pay more than a company that operates out of an office. Operations in risk-prone locations may also see increased premium costs.

Once you’ve established premiums, one option to mitigate insurance costs is choosing to pay as you go. This method helps spread out costs instead of making upfront lump payments. In addition, lump payments may require reconciliation at the end of the year, meaning additional bookkeeping and potential surprise audits.

Choosing the best type of worker’s comp insurance for your business may seem daunting, but there are many professionals ready to help you make the right decision and let you focus on what matters most.