Good Record Keeping Might Help Roofers Reduce Their Insurance Costs
For all of the peace of mind, the help it can provide in your time of need and the sheer necessity of it, the cost of insurance for your roofing business is noticeable. How can you reduce the premium on your workers compensation policy, for example?
One way you might be able to do that is through the premium audit.
The cost for your workers compensation policy is based on your roofing payroll and the jobs being actually done. In fact, the job being done is represented by a code. This code is tied to a rate which is developed using the exposure to risk that each job has. That rate is multiplied by the payroll to determine your premium costs.
However, the rate varies by the job being done. For example, the code for your office help does not have a very high rate because those workers are exposed to very little risk. It’s different for your employees who actually go on roofs. Because their risk is high, so is the rate for their code.
A premium audit, which occurs after the end of the policy period, is what insurance companies do to get the actual exposure correct. (You probably used the prior year or an estimate to set the payroll for the current year policy.) Your insurance premium needs to be adjusted to the actual year payroll costs.
If anyone in your company is off of work for any reason, their pay for that length of time should be deducted. If they work overtime and get time and a half, that extra half time should be deducted. If you started the year with 12 roofers but ended up with 5 because business slowed, that needs to be accounted for in your payroll.
In a review of your payroll records, the premium auditor will take all that into account before s/he comes up with the actual payroll number. This could reduce your premium giving you a credit from the insurance company. (It could also increase it if the opposite happens.)
Accurate Record Keeping
To make sure that your payroll is properly accounted for, maintain good records of how much money you actually spent on payroll while people were working. Make sure your employees are properly classed as salespeople, clerical help, foreman, roofers, etc. It could make a big difference in your premium.
USA Business Insurance – Roofing Insurance
Let a business insurance professional answer any workers compensation premium cost questions you have. In addition, get tailored protection for general liability, auto and properly in your roofing business by contacting us today.