Helping Small Biz With Workers Comp

Now here's an idea that might have some merit. A legislator in California is proposing to give small businesses a 20% discount on their Workers' Comp insurance. Assemblyman Anthony Portantino has proposed the credits, and I have to admit this would directly address one of my own long-standing concerns about the Workers' Comp system in most states: small employers get the shaft.

Larger employers tend to have insurers competing on price for their business. Smaller employers just get tossed into Assigned Risk plans (where costs tend to be much higher and service really crappy.) A 20% credit for smaller employers would be an effective way to shift some of this unfair burden.

Here in Illinois (where AIM is based) small employers usually get shunted to the Assigned Risk plan, where insurance costs can often be double what the cost would be in the so-called "voluntary market".

Price competition in Workers' Comp insurance tends to only exist for larger employers, even though the majority of businesses are small business.

So here's to Assemblyman Portantino for cutting right through this Gordian knot with a straightforward approach that actually could help small business.