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Workers Compensation Premiums – An Investment?


Workers Compensation Premiums Are An Investment

Workers Compensation premiums of any type are almost always viewed as an expense.  I actually changed my career path due to the question in the title.  Workers Compensation premiums should be viewed as an investment, whether a company pays premiums or is self-insured.

Picture of Man Using Laptop Workers Compensation Premiums An Investment

Mark Walls, who runs the Work Comp Analysis Group on LinkedIn recently wrote an article on the upcoming Workers Compensation changes in 2013.  One of the passages in the article reads as:

If you get the time, the Work Comp Analysis group in LinkedIn is worth following on a weekly or daily basis.

I do hope that more companies will view Workers Compensation as an investment.   The old “a penny saved is a penny earned” would be very applicable.

The return on investment (ROI) is that saving Workers Comp premium allows an employer to reinvest those funds directly back in their budget.

That is one of my reasons for changing my insurance education from a CPCU to a ChFC track.  The ChFC curriculum allowed me to analyze insurance as an investment.  Workers comp premiums that are treated as expenses get rolled into one expense category such as insurance program expense.  Once employers begin treating premiums of any type as an investment rather than an expense, the justification for WC risk management techniques become much more valuable.

Once an employer sees workers comp premium as investments with the insurance carrier, safety programs then become a justified investment to make to save a company’s budget.

Employers that wish to reduce their future liabilities are willing to pay sums at the front-end of claims to avoid the “claims snowball rolling down the hill.”   Loading up the risk management techniques at the start of a claim will always pay off in the long run by saving on workers compensation premiums.

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James J Moore - Workers Comp Expert

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Management 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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