Carrying workers compensation insurance a smart investment for businesses both large and small, although for most company’s it’s a state requirement. The cost for carrying a comprehensive plan can put your business in a financial crunch, so you may want to consider the benefits of enrolling in a pay as you go workers comp plan.

The Basics of Workers’ Comp

Most states mandate a certain level of insurance protection for business in the event of an employee injury or illness that occurs on the job. The coverage pays for expenses associated with pay while recovering, medical bills,  or rehab therapies. The state requirements on coverage vary by business, but it is one of the best financial investments a business can make.

The Costs of Workers’ Comp

According to the information found at, premiums for workers’ comp coverage are determined by the size and scope of a company, as well as prior accident records and risk management efforts. If a premium is too much for a company to pay at once or according to payment terms, pay as you go plan lets a company pay for the cost of the premium through each payroll transaction, spreading the cost over the course of a year. Adding or losing employees can create changes in the liability premiums, but these costs are assessed and usually settled up at the end of a policy term.