"Pay As You Go" Work Comp

[Break1630]

I hope everyone is enjoying some 3rd quarter success! I wanted to ask for feedback regarding some carriers' new "Pay As You Go" Work Comp products. I work in the small business department of our agency and have been apporached by at least 2 carriers who have two different products that are "pay as you go". If set up on this program, my client would have the WC premium EFT'd from their bank account after the payroll for the previous pay period was submitted. The reporting would be done by the payroll company and ideally would not create any additional work for my client.

I know there will be many clients who are hesitant to go down this road, but some may jump at it. There would be less liklihood of an audit resulting in additonal premium ORpaying too much premium based on high payrolls and waiting for a credit at the audit.

Has anyone written any of these?

[new2independent]

Hi Break,

We recently tried this program at my agency. The agency owner had set up programs with two carriers. I was ecstatic as I thought this was my foot in the door to several companies. I was wrong.

The problem with pay as you go insurance is that you have to go through the payroll company and not the client. Since the deductions are taken out through the payroll you must make sure the payroll company can work with the format provided by the carrier. For this reason you need to prospect payroll companies and not business for this program.

Of the six payroll companies I have met with, all have asked for compensation. The problem here is we cannot provide compensation to a non licensed entity. They decide no pay, no play, and the plan stalls.

I would reccomend really trying to sell it as adding value to their current client base, however do not get too optimistic about this program. I did and was dissapointed.

[jimmyr1978]

The Hartford has the only one that works, Xact Pay, but it requires Quickbooks Payroll processing. Class of business is limited. When quoting the comp, I always ask if they have Quickbooks. If so, I always offer The Hartford. It's a relatively easy set up, and clients won't shop it since they no longer have to think about work comp.

Can anyone tell me who the other carriers are? Working with ADP, Paychex or another processing company can be very cumbersome. It's probably not worth the effort.

[andybkohler]

The national payroll companies have made sure this worker’s compensation payment program [pay-as-you-go] is here to stay. There is no doubt about that. Why would a client pay workers’ comp premium any other way. The “pay-as-you-go” programs are cost containment strategies workers’ compensation clients can use to better manage their cash flow related to workers’ compensation premiums. Plus, access to these plans has changed in the recent past, possibly to the agent’s benefit. Historically, “pay-as-you-go”-type arrangements were almost exclusively found in and available only to clients of a professional employer organizations (PEO). But, not any more. We are a mono-line workers compensation MGA that offers a U-PAY-As-You-Go program for our retail agents. It’s true, you do need to be with a payroll company to gain access to this program. However, we are always open to adding new payroll companies to our network of payroll providers. A payroll processing relationship assures the insurance carrier that proper payroll is being reported and that the funds are available to pay the premium. Most carriers that work on this platform require that. We have several A rated carriers that work on a pay as you go bases. This helps the agent compete against national payroll companies ie ADP, Paychex and the other regional players. In addition, this tool will allow them to quash a PEO when comparing apples to apples. This new generation of pay-as-you-go product may allow many agents to offer their clients an alternative not previously beneficial to the producing agent. Now insured’s may be able to enjoy some of the cash flow benefits historically limited to PEO clients while agents remain out in front and earning income. If interested in learning more please visit our website at http://www.UnisourcePA.com.

Andy Kohler
Unisource Program Adminstrators
Andy.Kohler@UnisourcePA.com
678-294-5459

[WorkComp&Sense]

Break 1630,

Try Maxim Insurance Group or Appalachian Underwriters. Both have Pay As You Go programs and both are nation wide. I do not think either is tied to any single payroll company or software package.

Most of these program managers convert the data regardless of what type of accounting package it is generated from (provided it is an electronic file).

The "pay as you go" is just the 21st century version of monthly self-reporting. Not necessarily unique but sure is a lot more efficient for everyone invloved.

WorkComp&Sense

[ED3771316]

Appalicaian pay as you go extends to American Interstate insurance only, at least that is the way it is in Illinois. If that is what you are after, you may as well contract direct with Amerisafe and not give Appund half your commissions.
You are doing all the work and tossing in a middle man.

Applied Underwriters offers Payroll service tied to Pay as you go Comp. Only issue there is they offer pooled loss history and no gaurantee of cost. It was a great plan until they took away the Annual lock on rates and can now go up or down mid term.

Pay as you go is great for the seasonal business and that will be what tips the scales in your favor more then price.

Thats the way life goes in Illinois.

If you find a national Pay as You Go Carrier, please post it.

[new2independent]

You can't work through ADP and Paychex. They use the Hartford and are compensated for it. I would go through local CPA's and payroll companies.

We had tried First Cardinal. They may be regional though

[andybkohler]

We have a national insurance company that offers pay as you go, Zuirch. In addition, we have a a few regional companies that offer pay as you go.

Andy Kohler
Unisource Program Adminstrators

[Ins_pro02]

We use Applied Underwriters on a regular basis in CA. Even more lately b/c commissions are at 15%.

In CA they offer guranteed cost and profit sharing for larger risks. The one advantage over other payroll/comp companies is it is one contact for us. They have their own payroll in-house and they are an "A" rated carrier (owned by Warren Buffet). It is better than having to deal with say ADP and then also Hartford.

Has worked very well for us. Good luck and please post any others. Always open for more markets!

[paulhalter]

The Resourcing Solutions Group, Inc. (http://www.trsginc.com) has a program whereby the independent insurance agency benefits from having its own 'private labeled payroll program'. The program allows the agency the ability to offer pay-as-you-go WC, GL and EPLI through the private label arrangement. This permits the client o benefit from the cash flow of payroll deducted insurance while also earning a fee on the administrative fees for processing payroll. The agency owns the payroll book of business. The Resourcing Solutions Group provides all the administration services as the backroom TPA at no charge to the agency. This program is different than partnering with other national payroll vendors because it is the agency's branding AND the agency owns the book much like expirations.

[Break1630]

Thank you for the responses everyone. From the research I have done, the "pay as you go" method isn't very new, but not many agents are selling it. Are they scared of change? Do they not want to do the extra work? I do have Hartfordas and learning more about the XactPAY mode they have if a client uses Quick Books for their payroll. My first step in selling to that is to get introductions to whoever is recommending a client uses QuickBooks for their payroll? CPA perhaps?

I have a regional carrier who is has a flexible pay as you go model. by flexible I mean they are able to work with an unlimited number of payroll companies, as long as the payroll company cooperates.

I'll keep everyone posted on my success.

-db

[InsuranceshopJustin]

Hello everyone! My agency has written Pay as you Go work comp for several years. We partner with brokers and payroll companies to help meet the clients needs. We have markets available in all 46 non-monopolistic states. If you visit our website, www.payrollcomp.com, you can click on a state and see our market's appetite for each state. Also, for brokers we have a seperate website, www.workerscompensationbrokers.com. With all our referral points our agency receives approximately 100 new submissions a day for the Pay as you Go solution. In my opinion, the Pay as you Go solution is the only way to write workers comp for those businesses that qualify. Obviously, if the business isn't profitable they belong in the state fund.

Please contact me if you have questions or have an account you need to place.

Justin Bartmess
The Insurance Shop, LLC
573-445-5535 x12

[johnhoefer]

I checked almost everyone out on this thread and I came to the conclusion that InsurLinx is the most professional firm with the best options. We will be using them to bring this to market.

Irvine Insurance

[InsuranceshopJustin]

http://www.payrollcomp.com is making it easier to write PayGo workers comp insurance. We are allowing business owners to write coverage through our PayGo system without involving the payroll partner. Instead of partnering with the payroll company we ask for the clients payroll reports in order to calculate premiums. This allows clients to process their own payroll through QuickBooks or use a payroll partner that isn't willing to work with The Insurance Shop directly.

Please give me a call if you have a client that fits. We are very flexible with business classes, collection of premium and payroll reporting formats.

I consider our PayGo process to be the easiest to work with and have several references to back up this statement. I work with payroll partners who have utilized the other main PayGo providers, all of which would agree that The Insurance Shop's is the quickest to respond and the easiest to work with.

December and January are arriving fast. The majority of business owners will be making decisions on workers comp & payroll in the upcoming months.

Justin Bartmess
The Insurance Shop, LLC
http://www.payrollcomp.com
888-611-7467 ext 12
573-445-5535 ext 12

[JamesDibben]

Ok, so instead of trying to contact each of you providers above I thought I would reply to this thread and see who is still following it.

I have been using The Hartford for the last couple of months to get my pay-as-you-go work comp coverage. It has been working out great!

I was using ADP and that was/is a complete joke.

The reason I'm here is that I want to put together a page on my web site showing a list of providers who offer this type of work comp coverage.

My email is <I am no longer doing this> and I would love to talk to anyone who offers this type of service.

Many of my clients are starting to ask for this type of coverage and The Hartford won't cover just anyone.

There is one major requirement. You must have a solution that works VERY well with QuickBooks. I DO NOT want a replacement payroll option at all.

You can also visit my site at http://bluecollarcoaching.net if you want to know what I do and why I need this information.