Complying with workers’ compensation requirements is rarely easy for any employer. For temporary staffing firms, workers’ comp can be especially complex. Many insurers simply don’t cover the industry, and those that do may impose strict limits that can restrict a firm’s growth or price premiums at unaffordable levels. For new and mid-sized firms, workers’ compensation costs can be decisive in the business’s long-term viability. There are several reasons why the staffing industry faces these challenges:
- Limited site control. A staffing firm needs to provide workers’ compensation coverage not just for its administrative staff, but also for the workers it sends out to client sites. Although the firm’s contracts with its clients might provide for some safety requirements, the reality is that the client, not the staffing firm, is in charge of its own site.
- Limited management control. Just like the physical conditions at a client’s location, the staffing firm’s employees are also mostly out of reach of the firm’s managers during assignments. Firms that serve high-risk industries need to conduct safety trainings to help their employees avoid injury, but ultimately the employees may get hurt while under the client’s exclusive supervision.
- A changing scope of work. Staffing firms provide labor to many industries, some more dangerous than others. Workers’ compensation coverage needs to be tailored to address the specific risks of a specific job. When a client asks for help with a job that is new to the firm, ensuring that workers’ compensation will cover that work can be tricky. For example, a firm that routinely provides office support staff to a hospital might not have coverage for higher risk positions like nursing assistant, but may want the option of expanding into that area should the opportunity arise.
- Lack of understanding. A more abstract problem staffing firms can face as they go into the insurance marketplace is a general lack of understanding about their industry. A general business insurance firm may be used to dealing with conventional companies, but lacks the expertise and institutional agility to address a staffing firm’s requirements. Likewise, an insurance broker who doesn’t have experience with the staffing industry may not know how to meet the firm’s needs in an affordable and practical way.
The good news is that staffing firms can overcome these challenges. With the help of an insurance broker who understands the industry and the insurance marketplace, a firm can develop good risk management processes and find workers’ compensation coverage that is competitive, profitable, and hassle-free.
Gunnin Insurance specializes in serving the temporary staffing industry. Our team of experienced insurance brokers, risk-management experts, and claims advocates have deep knowledge of the insurance marketplace. We help firms with every phase of their workers’ compensation program, from initial risk assessment to claims processing and dispute resolution. Contact us today to find out how Gunnin can help your business thrive.