Short Rate Penalty

Switching Workers Comp Carriers Early Can Be Expensive

Switching Workers Comp Carriers Too Early Very Costly Switching workers comp carriers can be a trying task at renewal.   During the year, that option can be very costly due to the Short Rate Penalty.  The various state insurance departments decided to eliminate or at least heavily discourage employers from jumping

Canceling Your Policy Right After Renewal Or Premium Audit Costly

Canceling Your Policy Right After Renewal Bad Choice Will canceling your policy post-renewal due to a premium audit cost your company $$$? We receive this question at least once per week.   This is an almost verbatim question from two weeks ago with editing for length. Question – “We just

Is a Post Audit Policy Switch Good Idea For Most Companies?

Post Audit Policy Switch Can Be A Disaster If Knee Jerk Reaction A post audit policy switch may not be a good idea in most cases.  The penalty incurred may be significant. I received this question over the holiday weekend.  Our recent premium audit by the Workers Comp auditor indicated

Premium Audit Bill and Policy Renewal Conondrum

Changing Carriers Due To Premium Audit Bill Can Be Costly Our Workers Comp premium audit bill surprisingly increased our premium by 26%.  We do not necessarily agree with the audit and want to change insurance carriers.    Due to the timing of the audit, we are already two months into our next

Premium Audits And Short Rate Penalty – continued

Premium Audits And The Short Rate Penalty In my last post, I covered the predicament some employers can be in when they want to switch insurance companies due to their premium audit sticker shock. The main consideration is the short rate penalty. The premium audit has just been completed so

Premium Audits And Short Rate Penalty Workers Comp Extreme Premium Charge

The Short Rate Penalty And Premium Audits The short rate penalty is one of the most severe penalties that your company can receive in Workers Compensation.  With a short rate penalty, workers comp carriers accelerate the premiums on a policy beyond a pro rata share of the total annual premium. 

What Is A Short Rate Penalty For Workers Comp Policies?

The Short Rate Penalty Can Be Significant A short rate penalty is applied by insurers when a Workers’ Compensation insurance policy is cancelled by the insured before the expiration date of the policy. In the early days of the policy this penalty is steep. It will gradually taper off the

Short Rate Penalty Expensive Choice To Change Policies Mid-Term

The Short Rate Penalty Eliminates Policy Hopping A workers comp insurance policy may be cancelled before the end of the policy period, but not without penalty. Most policies require a short rate penalty when a policyholder requests cancellation. The amount of the penalty is determined by a table of factors

Short Rate Workers Comp Policy – Problems Many Employers Face

Short Rate Workers Comp Policies The Short Rate Policy or Short Term Cancellation is when an employer and/or their agent makes the decision to cancel a policy before the renewal date. There are many problems with Short Rate Policies including: The ominous Short Rate Penalty – This penalty can be

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