Can a Carrier Drop Your Workers’ Comp Insurance Because You Are a “High-Risk Business”?
If you’re business is considered high-risk, a Workers’ Compensation insurance carrier might drop your policy. Should that happen, it’s important to know what to do next.
Unfortunately for business owners, some Workers’ Compensation insurance carriers might drop a policy if a company’s risk factors increase. This might occur after serious workplace accidents or significant changes in payroll. When a carrier cancels a policy, an employer might have difficulty finding Workers’ Compensation insurance quickly enough and might then face financial penalties or stop-work orders for non-compliance with their state’s coverage requirements. Suppose your carrier recently dropped your policy because of increased risk factors. In that case, our brokers can help you quickly find another Workers’ Compensation plan that meets your needs.
At NPN Brokers, we care about helping high-risk businesses get the Workers’ Compensation insurance they need to stay protected. To learn more about the Workers’ Compensation insurance brokers at NPN Brokers, call today at (866) 340-9120.
Can a Carrier Drop Your Workers’ Comp Insurance Because of Increased Risk?
When an employer agrees to a Workers’ Compensation insurance policy, they enter into a contract. Typically, these policies can only be dropped or canceled if something occurs that violates that contract. A common reason why an insurance carrier might drop a business’s Workers’ Compensation insurance is because of increased risk.
Workers’ Compensation insurance policies and their premiums are largely determined by risk. An insurance company might assess your business’s age, industry, payroll, and history of workplace injuries to determine how big of a risk it is taking to insure your company. Suppose one of those important factors changes, and you are now a bigger risk to insure. In that case, a Workers’ Compensation insurance carrier might cancel your current policy.
Increased risk might occur due to a wide variety of factors. One or several workplace accidents in quick succession might indicate an increased risk to a Workers’ Compensation insurance carrier, resulting in it dropping your policy. Other factors, like an increase in payroll or a change in workers’ responsibilities, might also result in a Workers’ Compensation insurance policy cancellation.
Business owners should understand that Workers’ Compensation insurance policies are not always set in stone. When circumstances change, so might your Workers’ Compensation insurance policy. To better understand the likelihood of this happening and what it might mean for your company, speak with our Workers’ Compensation insurance brokers.
What Can Happen if a Carrier Drops Your Workers’ Comp Insurance Because of Increased Risk?
If a Workers’ Compensation insurance carrier drops your policy, leaving you without coverage, your company might be vulnerable. Stop-work orders, fines, and financial liability might be in your future if your carrier cancels your Workers’ Compensation insurance policy.
New Coverage Requirements
In many states, Workers’ Compensation insurance is mandatory for certain businesses. If circumstances changed, allowing your carrier to drop your insurance, those changes in circumstances might also now require you to purchase Workers’ Compensation insurance in your state.
For example, suppose an insurance carrier canceled your policy because of increased payroll, putting your company at a higher risk of workplace injuries. In that case, that payroll change might also require your company to purchase Workers’ Compensation insurance in your state. To learn if recent changes in your company have affected your coverage requirements, consult our Workers’ Compensation insurance brokers.
A sudden lack of coverage might result in a stop-work order, halting your company’s operations until you can acquire a new policy. This can be detrimental for businesses and workers alike, who might be unable to earn an income during this time.
Some states impose financial penalties and other consequences on employers for insufficient Workers’ Compensation insurance coverage. Suppose your carrier drops you, even with the proper notice. In that case, you might be unable to find insurance in time, causing you to face fines and other penalties for non-compliance with your state’s Workers’ Compensation insurance requirements.
What to Do if a Carrier Drops Your High-Risk Business’s Workers’ Comp Insurance?
Suppose your carrier recently dropped your business’s Workers’ Compensation insurance because of increased risk factors. In that case, employers can contact our Workers’ Compensation insurance brokers. While quickly finding coverage is important, but so is finding reliable and affordable coverage.
When increased risk factors cause an insurance carrier to drop your policy, you might be at a loss. If your business is now considered high-risk, it may be difficult to find an affordable Workers’ Compensation insurance policy on such short notice. The challenges might increase if you are required to purchase coverage in your state.
If you are in this situation, reach out to experienced professionals immediately. Our brokers have relationships with insurance carriers that offer Workers’ Compensation policies to a wide variety of businesses, including those considered high-risk. After sending over the necessary information, you can receive quotes quickly in a matter of days. Our brokers can then help you assess Workers’ Compensation insurance policies to find coverage that suits your needs.
When an insurance carrier drops a policy because a company has become a greater risk to insure, employers might be concerned that finding affordable coverage is impossible. That’s not the case when employers know where to search. When you partner with our brokers, you can quickly find comprehensive, flexible Workers’ Compensation insurance that keeps your company and employees covered without breaking the bank.
Our Brokers Can Help High-Risk Businesses Get Workers’ Comp Insurance
If you need Workers’ Compensation insurance for your high-risk business, our brokers can help. To learn more about the Workers’ Compensation insurance brokers at NPN Brokers, call today at (866) 340-9120.
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