Do you want to save money on your insurance? Got your attention now, didn’t I. There are two issues that appear to be recurring that could cost you a lot of money. They are current insurance certifications from your subcontractors and proper classifications for your workers on your workers compensation policy.
Clients expect you to do more difficult jobs, regardless of whether you work in commercial or residential settings. These jobs require many disciplines to complete. Many of these jobs require the use of subcontractors. They perform many different jobs. There are many things that you can think of when it comes to electrical work, plumbing, masonry, tree work, and pool work. You, the contracting party, are responsible for all subcontractors that you hire to work on a project. Your insurance company or you will be held responsible if a claim is made for property damage or bodily injury due to the actions of subcontractors you have hired. This is why you purchased insurance. Hopefully, subcontractors you hire are insured and will be held responsible by their insurance company. Your insurance company will charge a nominal fee for subcontractors who are insured. They will also change the rate for those subcontractors who are not covered. A system is usually in place for subcontractors who use many subcontractors. They will also keep current certificates of insurance and ensure that they are all insured. This is a great way to ensure that your current information is on file. This information is harder to find once payment has been made. You will find it easier to audit your subs and for insured subs.
Workers’ compensation and proper classifications. It’s amazing how many times I see employees in higher classifications due to not being prepared for an audit, ignorance of the process, or simply not being informed about the existence of different classifications. The classification rules are set by a manual and process. You have more chance to save premiums if your records are accurate. Sometimes it’s possible to split the payroll of a single employee between two codes. For example, landscape gardening or lawn maintenance. Accuracy is key. It is important to have accurate records. Also, anyone who meets with an insurance company auditor should be informed about the process. Each job description has a different rate. Clients may have seven job categories on their workers compensation policy. Each one has a different rate. Sometimes, the rate difference between lawn care and landscape gardening is 100%. This can quickly add up if you are not careful.