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PEOs for Workers Comp – Are They Worth It? Answer – Most of The Time

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PEOs Are Great For Workers Comp But Not Every Time

Workers Comp PEOs (Professional Employment Organizations) have gained a great amount of attention lately. Are they a viable source of Workers Comp coverage for your business?

Picture Of PEOs Professional Employment Organization Standing In A Row
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The unregulated PEO’s of the past caused all state insurance departments to initiate more laws, rules, and regs over the last few years.

I am sure you have seen the news headlines where certain ones were shut down and their owners were sometimes prosecuted for fraud and other crimes. I have seen very few of those articles in the last two years.
Any time you sign a contract for workers comp insurance, make sure you read the document fully.  Reading the agreements always makes sense.  I have seen many results where the employers sign the documents without reading them.
My last article mentioned the possibility of using a PEO as a possible viable way to avoid going into the risk pool and paying premiums of up to 800% more than the usual Workers Compensation marketplace for coverage.

Before exploring the PEO marketplace, you would need to pause and think about how your company came to be possibly insured by an Assigned Risk Pool insurance carrier. The same considerations that may have landed your company in the risk pool may prevent you from being considered by any of the PEO’s.

Hand Picking Up PEOs In Shark
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The PEO’s underwriters are going to examine the same information that the carriers have covered in the decision to not underwrite your business. Having your Workers Comp claims loss runs will speed up the process greatly.   Find your E-Mod Sheets.  They request those every time for the underwriting process.
The best way we have seen to explore the PEO marketplace is with a PEO broker. There are many of them online. Googling the term PEO or PEO broker will bring up hundreds of them.  Use this contact form if you have questions.
We have come across a few PEO’s and specialized brokers that have been great to work with over the last few years. As J&L is not an agency nor do we sell any type of coverage. We have no bias as to one company or the other.
One of the questions we receive is how can PEO’s write my business for a lower premium than the Assigned Risk Pool or regular marketplace? I will cover that next time along with a few advantages of using a PEO.
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James Moore

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Mgmt Consultants, Inc. in 1996. J&L’s mission is to reduce our clients’ Workers Compensation premiums by using time-tested techniques. J&L’s claims, premium, reserve and Experience Mod reviews have saved employers over $9.8 million in earned premiums over the last three years. J&L has saved numerous companies from bankruptcy proceedings as a result of insurance overpayments.

James has over 27 years of experience in insurance claims, audit, and underwriting, specializing in Workers’ Compensation. He has supervised, and managed the administration of Workers’ Compensation claims, and underwriting in over 45 states. His professional experience includes being the Director of Risk Management for the North Carolina School Boards Association. He created a very successful Workers’ Compensation Injury Rehabilitation Unit for school personnel.

James’s educational background, which centered on computer technology, culminated in earning a Masters of Business Administration (MBA); an Associate in Claims designation (AIC); and an Associate in Risk Management designation (ARM). He is a Chartered Financial Consultant (ChFC) and a licensed financial advisor. The NC Department of Insurance has certified him as an insurance instructor. He also possesses a Bachelors’ Degree in Actuarial Science.

LexisNexis has twice recognized his blog as one of the Top 25 Blogs on Workers’ Compensation. J&L has been listed in AM Best’s Preferred Providers Directory for Insurance Experts – Workers Compensation for over eight years. He recently won the prestigious Baucom Shine Lifetime Achievement Award for his volunteer contributions to the area of risk management and safety. James was recently named as an instructor for the prestigious Insurance Academy.

James is on the Board of Directors and Treasurer of the North Carolina Mid-State Safety Council. He has published two manuals on Workers’ Compensation and three different claims processing manuals. He has also written and has been quoted in numerous articles on reducing Workers’ Compensation costs for public and private employers. James publishes a weekly newsletter with 7,000 readers.

He currently possess press credentials and am invited to various national Workers Compensation conferences as a reporter.

James’s articles or interviews on Workers’ Compensation have appeared in the following publications or websites:

  • Risk and Insurance Management Society (RIMS)
  • Entrepreneur Magazine
  • Bloomberg Business News
  • WorkCompCentral.com
  • Claims Magazine
  • Risk & Insurance Magazine
  • Insurance Journal
  • Workers Compensation.com
  • LinkedIn, Twitter, Facebook and other social media sites
  • Various trade publications

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