The Real Value of a Great Claims Management

When it comes to workers’ compensation insurance, the quality of claims management can be a make-or-break proposition for small businesses. Poor claims management not only raises costs but also leads to many other issues.

Small businesses that don’t promptly and accurately handle claims risk their employees’ well-being, trust, and even their company's reputation.

That’s why great claims management is such a valuable proposition. Businesses with efficient and accurate claims management enjoy:

• Lower costs.
  
  
• Fewer administrative hiccups.
  
  
• Better compliance outcomes.
  
  
• Happier and healthier workers.

In this guide, we’ll examine the value that great claims management can actually provide.

Common Problems Small Businesses Face with Workers' Compensation Insurance

Small businesses often face significant challenges with workers' compensation insurance, primarily due to their limited resources and expertise. As a broker or trusted advisor, you might notice that some of your clients suffer from issues like these.

Uncontrolled Costs

One common issue is the financial strain caused by high premium costs, which can be particularly burdensome for small businesses with tight budgets. 

Additionally, small businesses may struggle with understanding the intricacies of coverage options. This can lead to either over-insurance, which wastes resources, or under-insurance, which leaves them vulnerable.

Added Administrative Burden

Another major problem is the administrative burden associated with managing claims. 

Small business owners often lack dedicated HR staff, forcing them to handle claims themselves. This can result in mistakes, delayed filings, or inadequate documentation, all of which can complicate the claims process. Furthermore, small businesses are more susceptible to fraudulent claims, as they may not have robust procedures in place to detect and prevent them.

Difficulty Navigating Compliance Issues

Lastly, small businesses might find it challenging to stay compliant with ever-changing state regulations. 

Non-compliance, whether due to ignorance or oversight, can result in severe penalties, legal challenges, or even the suspension of operations. This adds another layer of risk to an already complex area of business management.

Why Poor Claims Management is an Especially Big Problem for Small Businesses

Poor claims management can have a cascading effect on a small business, impacting its finances, operations, and employee relations. When claims are not handled properly, it can lead to:

• Financial Losses: Mishandled claims often result in higher payouts, increased legal costs, and elevated insurance premiums.
  
  
• Operational Disruption: Extended claims processes can leave positions unfilled, leading to decreased productivity and overburdened remaining staff.
  
  
• Damaged Morale: Workers who see their colleagues’ claims mishandled may feel undervalued, which can result in lower morale and productivity.
  
  
• Legal Risks: Poor management can lead to disputes and potential lawsuits, which are both costly and time-consuming.

For small businesses, which often operate with thin margins and limited staff, these issues can be particularly damaging. The lack of proper claims management processes can turn an already stressful situation into a crisis that threatens the very survival of the business. 

In contrast, effective claims management helps mitigate these risks, ensuring that the business can recover quickly and continue operations smoothly.

How Great Claims Management Adds Value to Workers’ Compensation Insurance

The benefits of strong claims management go far beyond simply reducing costs. 

Great claims management helps small businesses protect their most valuable assets: their people and their reputation. By handling claims efficiently and fairly, a business not only minimizes financial losses but also fosters a culture of trust and safety among its employees.

Great claims management adds value through:

• Faster Resolutions: Quick and fair claim resolutions allow injured employees to return to work sooner, reducing downtime and maintaining productivity.
  
  
• Cost Control: Effective claims management helps keep insurance premiums in check by preventing unnecessary payouts and legal battles.
  
  
• Employee Retention: Employees are more likely to stay with a company that demonstrates it values their well-being by managing claims responsibly.

Small businesses rely on every employee to perform a crucial role. This means the importance of maintaining a positive work environment cannot be overstated. Great claims management ensures that workers feel supported and respected, which in turn enhances loyalty and performance. This, ultimately, contributes to the long-term success and stability of the business.

How Partnering with a PEO Can Resolve Workers' Compensation Claims Management Problems

Working with a PEO offers a practical solution to the challenges of workers' compensation claims management:

• PEOs have specialized teams dedicated to managing claims, ensuring that each case is handled efficiently and correctly.
  
  
• They stay updated on the latest regulations, reducing the risk of non-compliance and associated penalties.
  
  
• PEOs often have the bargaining power to negotiate better insurance rates, and their efficient claims management can lead to lower premiums over time.
  
  
• With a PEO managing claims, small business owners can focus on growing their business instead of getting bogged down in complex and time-consuming administrative tasks.

For many small businesses, the decision to partner with a PEO becomes a strategic advantage. 

By leveraging the PEO’s expertise and resources, small businesses can enhance their claims management processes, reduce risks, and ultimately create a safer, more productive work environment. This partnership can transform how a small business approaches workers' compensation, turning it from a liability into a well-managed asset.

How BBSI Streamlines Claims Management for Small Businesses

Mishandled worker’s compensation claims increase costs, disrupt operations, jeopardize employee relations, and can even cause legal trouble. Small businesses that lack the resources needed to combat these problems on the fly need to avoid them altogether.

BBSI understands this, which is why we prioritize a worker’s compensation claims management approach that seeks first to ensure quality employee healthcare and then cost-effective outcomes. 

We do this by:

• Providing access to a 24/7 nurse triage hotline. They’ll seek to first ensure quality care for your workers, then get started on a streamlined claims management process.
  
  
• Mitigating risk by identifying vulnerable areas and helping SMBs implement programs that limit their exposure.
  
  
• Protect a business’s bottom line through predictable premiums and reduced frequency of claims.

If you’re an insurance broker or a trusted advisor who’s interested in helping your clients gain access to better claims management, BBSI is here to help.

Become a BBSI partner today and get access to one more way to drive client growth.