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Workers’ Compensation Insurance Calculator & Estimates

03May

How to Calculate Workers Compensation Cost Per Employee

Or, read on for step-by-step instructions, and other factors that play a role in your final workers’ compensation quote. In Pennsylvania, workers’ comp pays 66% or two-thirds of an employee’s average weekly wage, up to the state max of $1,273 (for 2023). That’s assuming the employee makes between $954.76 and $1,909.50 per week. In Wisconsin, workers’ comp pays up to two-thirds of an employee’s average weekly wage, not to exceed the state maximum, which is $1,870.50 for 2023.

How to Calculate Workers Compensation Cost Per Employee

This means that your workers’ comp premiums are based on your employee’s wages before taxes, deductions for healthcare coverage and retirement, and other such deductions. Payroll, class code, and EMR will give you a general idea of your workers’ comp premiums, but there may be other factors at play as well. Your How to Calculate Workers Compensation Cost Per Employee class codes help determine your rate—higher-risk jobs will require you to pay more per $100 of payroll, whereas lower-risk jobs will typically be cheaper. Your independent insurance agent can help you calculate exactly how much workers’ compensation insurance your specific business needs to fully cover its team.

Workers’ Compensation Insurance Cost Calculator [Free Download]

An injured worker who files a workers’ compensation claim can receive weekly benefits if they’re unable to work, as well as money to pay for any medical care they need as a result of their injury. The premium your company is charged for workers compensation is unique to your company based on a variety individual factors. It is also possible that the class code for an employee may change due to the duties of their job changing.

Finally, insurance carriers may add on the Expense Constant, or money to compensate them for the cost of administering your policy. Some states, like California, tend to have more work-related lawsuits, so if you’re located in one of these states, you may have to pay more for your insurance coverage. If https://www.bookstime.com/articles/gross-sales-vs-net-sales you’re a new business with no prior history, you’ll start out at 1. If you’ve had multiple employee injuries in the past or one or two severe injuries, that number will be higher. Our comp model is pay-as-you-go, and we charge based on your actual, real-time payroll numbers, so there’s no guessing.

Partial vs Total Disability

They will review your information, provide expert advice, and make calculations that consider all the factors in the workers’ compensation model. Multiply the rate provided by the insurance carrier by the payroll amount from step 3. Next, multiply this product by your EMR to get your annual workers’ compensation premium. It’s crucial to familiarize yourself with your state’s workers’ compensation regulations since these laws vary from state to state.

Remember, the steps we just went through for how to calculate the workers’ compensation cost per employee will give you a very rough estimate. Other factors—such as the number of employees, location, taxes and your experience modification—can influence how much workers’ compensation costs. Every business is different, and will have a different average workers’ comp cost per employee.

How to Calculate Workers Compensation Cost Per Employee

Download the workers’ compensation calculation sheet, then follow along this post for step-by-step instructions to add up your insurance estimate. Excluded from “gross wages” are tips or other gratuities, payments for group insurance or group pension plans, expense reimbursements and other fringe benefits. At the annual policy audit, actual wages must be calculated and reported to reflect any changes.

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