Why You Need Human Resources for Your Small Business | Part 2

Like most small business owners, you’re used to handling all business activities yourself. This includes all human resources tasks. In fact, 54% of small businesses handle HR in house, but owners usually give HR work to staff with little proper training and knowledge to manage employees and properly administrate HR.

If you have over 20 staff, it’s not enough for you to give HR work to someone in finance or operations. Creating your own HR team can improve employee experience and free you to focus on your business.

Improve Your Business with Human Resources Support

HR personnel are experts in handling HR issues, including employee relations and motivation. Your own HR team not only helps you follow employment law; it ensures the health and safety of your staff.

Your HR team can develop policies that lead to employee well-being and engagement, too. The employee satisfaction that HR managers help you create is vital for small business success.

What Is the Role of HR Personnel, Exactly?

Your HR team helps with far more than just dealing with difficult employees and handling employee complaints. They can help you create conditions where staff thrive.

Here are some typical roles your HR department will play.

Compensation & Benefits

This is another area, if not done professionally, that can lead to woes for small business owners. HR personnel are trained in handling employee compensation and, if applicable, federally mandated employee benefits. HR assists in managing important tasks related to paying employees. This includes employment taxes, Unemployment insurance and Workers’ Compensation insurance.

Human resources works with outside specialists on different aspects of employee compensation and benefits. This can include timekeeping, payroll, life, health and disability insurance, and retirement planning. They also manage the costs of payroll and benefits, taking those tasks off your busy hands.

Creating and Updating Employee Handbooks

Your employee handbook is critical to managing staff and avoiding costly litigation. It’s where you share your firm policies, practices, and procedures in writing. Besides your code of conduct, the handbook should also cover important rules. Some examples are diversity and anti-discrimination, sexual harassment, hiring, discipline and complaint reporting methods.

This worker’s playbook answers staff questions and helps prevent misunderstandings. It’s also a tool to communicate your company’s mission, vision and core values. human resources can manage your employee handbook if you have one or help you develop the all-important tool if you don’t.

Handling Performance Reviews

One stressor that small business owners experience is conducting performance reviews. HR helps remove barriers to positive employee relations by overseeing this function. That includes employee evaluations, annual reviews and exit interviews.

The extent to which they handle this depends on the size of your business. But HR personnel are authorities in determining what those measures should be. They can conduct this process in a way that preserves a positive employee experience, too.

For example, HR can give employees tools and training to improve performance and productivity. HR also helps you track staff’s professional advancement, so your employees grow. This helps with retaining the best talent.

How Do I Set Up HR for a Small Company?

For a limited time, Stromsoe Insurance Agency is giving our business clients access to our proprietary HR Program! You will receive the first year at NO cost!

People Management Solution Include:

  • Personalized Handbook
  • Live HR Advisors (Phone, Email & Chat)
  • HR & Compliance Resource Library
  • Workplace Harassment Prevention
  • Workplace Safety
  • Extensive Learning Management Library

Simply complete this application (CLICK HERE) and one of our team members will be in touch with you shortly!

 

Questions? Want to learn more? Here’s 4 easy ways to reach us:

Phone: 951-600-5751
Email: insure@siaonline.com
Text: 951-482-8144
Web: www.siaonline.com

PS Here’s a few words from one client that trusts Stromsoe Insurance Agency:

“I’ve been with Stromsoe Insurance For over 15 Years. Their Murrieta Office was actually my first Project after I got my license. I refuse to go anywhere else! They shop all my policies to save me money and i can talk to everyone with one phone call! I recently Moved to Arizona, and Started a new Company. Stromsoe was able to get me going and again has all my policies! Thx Guys!”
Mike Hughes – Semper Fi Plumbing, Inc. – Surprise, AZ – Client Since 2007

PPS Every policy is backed by our iron clad, 100% complete satisfaction guarantee. Ask for your copy today!

Are Your Records Prepared for Your Work Comp Audit?

It’s been said that “Today’s preparation determines tomorrow’s achievement.” Your thoroughness in preparing for your work comp audit will determine the success of your outcome.

It is imperative that you, as the owner of the business, oversee all documents provided to the auditor. For example, do not simply have the auditor work with your bookkeeper without inspecting the final documents provided to the auditor. Over the years, we have experienced many incorrect audits because the bookkeeper did not provide the correct records.

You will want to have these records prepared as they are normally REQUIRED to complete your audit:

  1. Gross Payroll Journal / Employee’s Earnings Records minus excluded remuneration.
  2. General Ledger / Canceled Checks / Cash Disbursement Journal / Check Register.
  3. Clerical / Salespersons form completed by a principal of your company.
  4. State Quarterly Wages and Withholding Report (Form DE6 and DE6B).
  5. Employee’s Quarterly Federal Tax Return (Form 941).
  6. Form 1099 if applicable
  7. Sub-Contractor Verification form with Contractors License Numbers
  8. State Report of Independent Contractors Form DE542.
  9. Copies of Certificates covering any Sub-Contractors work attached to Sub-Contractor Detail Sheet (Form 6090). Any subcontractor for which this completed information is not provided at the audit will be included for premium purposes.

 

If you would like to discuss any aspect that affects your Workers Comp coverage and premium, here are 4 easy ways to reach us:
Phone: 877-994-6787
Text: 951-482-8144
Email: info@correctcomp.com
Web: www.correctcomp.com

Here are some kind words from a business that trusts Stromsoe Insurance Agency:
“We’re very happy with you, you’ve been great for us in the handling of our personal & business insurance.”
Lucy & Mario Dominguez- Dominguez Grove Service – Murrieta, CA Client Since 1991

The CorrectComp system is a division of Stromsoe Insurance Agency

How Much Liability Insurance Do I Need for my Business?

“How much liability insurance do I need for my business?” is a question many entrepreneurs have. The short answer is as much as your budget will allow.

Additional factors that affect the cost of your liability insurance are:

  • the type of business you operate
  • the annual amount of your gross sales/receipts and employee payroll

The Basics of Liability Insurance

When it comes to liability insurance fundamentals, the phrase “business liability insurance” is a wide notion. 

There are Many Types of Business Liability Insurance

It’s important to have a conversation with your local, independent insurance agent to determine which types of liability insurance you should invest in for your business. Below are the most common types of business liability.

  • General Liability
  • Professional Liability
  • Automobile Liability (even if you don’t own one)
  • Employee Practices Liability Insurance
  • Cyber Liability
  • And others

How Much Liability Insurance is Needed?

Liability insurance protects and defends your business for everything it’s legally obligated to pay for because of it’s operations, subject to policy coverage and exclusions. When thinking about how much liability insurance you need, there are two important pieces of data you should consider:

  • how much is your business worth?
  • what are your contractual obligations to provide liability insurance?

Your local independent insurance agents at Stromsoe Insurance Agency are here to help you determine what’s best for you and your business.

 

Questions? Want to learn more? Here’s 4 easy ways to reach us:

Phone: 877-994-6787
Email: insure@siaonline.com
Text: 951-482-8144
Web: www.siaonline.com

PS Here’s a few words from one client that trusts Stromsoe Insurance Agency:

“Our longtime agent told us it would be 5-7 days to get basic BOP/General Liability Insurance. I called Stromsoe because it had 5 star reviews and so many people (200 plus) giving them excellent reviews. And they lived up to it. Ann P. immediately addressed my issues, figured out how to satiate our commercial landlord, locked down feasible rates, and made it happen for us in one day. Endlessly responsive and informative. We got our Certificate of Insurance on a complicated issue. Thanks Ann. You deserve to be recognized. I’m switching both of our businesses to YOU! Highly recommend, see Ann P.”Nicole Fuller – Dr. Maryanne Hannaney & Nicole Fuller – Temecula, CA – Client Since 2021

PPS Every policy is backed by our iron clad, 100% complete satisfaction guarantee. Ask for your copy today!

Are You Paying the Correct Work Comp Premium?

There are many factors that contribute to your company paying the correct work comp premium. Below are considerations you must be thinking about when purchasing work comp insurance. 

PAYROLL

INCLUDES wages, salaries, commissions, cash payments to subcontractors, bonuses, vacation, holiday and sick pay, straight pay for overtime hours, market value of lodging provided, market value of gifts, and all other substitutes for money.

DO NOT INCLUDE WITH PAYROLL:

  • Overtime pays in excess of straight pay for the employee. Put the overtime excess payroll in the box marked “Overtime Excess.”
  • Payroll of owner of sole Proprietorship; or husband and wife Employer if joint ownership is NOT a corporation or partnership.
  • Payroll for corporate officers, partners, or member managers of LLC if specifically EXCLUDED BY CURRENT ENDORSEMENT to the policy.
  • Wages of subcontractors that provide you with a valid Certificate of Workers’ Compensation coverage.

 

INTERIM RATE (Actual Rate You Pay per $100 of Gross Payroll)

The RATE listed on your payroll report or policy is an adjustment to company base rates and already includes the competitive rating credits/debits, which apply to your policy. This rate may include an Estimated Premium Discount, which is based on an estimate of your payroll/premium for the policy. Your final bill will use company base rates, apply competitive rating credit/debits, and calculate a Final Premium Discount for your policy. If ESTIMATED payroll DIFFERS FROM ACTUAL PAYROLL, final Premium Discount can change at FINAL billing after audit, and may result in premium due or a refund.

 

CALCULATING PREMIUM

To calculate premium due for each classification, multiply the gross annual payroll by your interim rate as a percentage. Always deduct excluded remuneration before calculating.

 

EXPERIENCE MODIFICATION

If the Workers’ Compensation Insurance Rating Bureau, NCCI or your state jurisdiction issued an experience modification (XMOD) for your policy (must meet and maintain 3-year premium threshold), you should have been notified by an endorsement. The XMOD will appear in the Experience Modification section of the payroll report or on your policy declaration. Please multiply the XMOD by the gross premium amount to calculate total premium due for the reporting period.

 

EXECUTIVE OFFICERS AND PARTNERS

UNLESS SPECIFICALLY EXCLUDED by endorsement, officers or partners are covered for benefits. Payroll should be reported, subject to minimum and maximum remuneration per annum for each officer or partner. The minimum and maximum payroll amounts for most recent years are as follows:

Policy Year                                      Minimum Payroll                          Maximum Payroll

2020                                                       $54,600                                                 $139,100

2021                                                        $54,600                                                 $139,100

 

CONSTRUCTION CLASSIFICATION BY WAGE LEVEL

Certain construction classes are divided into multiple codes depending on the regular hourly wages paid to an employee. Report payroll according to the wage level indicated on the front of your payroll report or declaration page. The wage thresholds may change from year to year and are subject to verification at time of audit.

 

CONTRACT WORKERS (SUB-CONTRACTORS) (1099s)

To exclude contract workers from reported payroll, a valid license (when required) and a valid Certificate of Workers’ Compensation coverage MUST be available and shown to auditors (at time of audit) to avoid additional premium charges. Contact our office if you have any questions about contractor (1099) / employee (W-2) status.

 

CHANGES IN OPERATION

ANY CHANGES in operation MUST be reported in writing to the Insurance Company immediately. Any additions, changes or updates of a classification, including 8810-Clerical and 8742-Outside Sales, must be approved, and endorsed on your policy by the Insurance Company before the payroll report can be processed and the classification allowed. To request any of the below, contact our agency at 877-994-6787.

  • A new classification,
  • a change in operations,
  • change in ownership,
  • or other changes such as officers, location, etc.

 

If you would like to discuss any aspect that affects your Workers Comp coverage and premium, here are 4 easy ways to reach us:
Phone: 877-994-6787
Text: 951-482-8144
Email: info@correctcomp.com
Web: www.correctcomp.com

Here are some kind words from a business that trusts Stromsoe Insurance Agency:
“I can always count on the staff at SIA to work with me and do some of the most engaging hard work to get my insurance issues handled as well as the simple easy items I should probably do myself. Small or large they are willing to take the task on. The great people at SIA are always willing to go the extra mile.”
Terri Barry – Safe and Secure Locksmith Service – Murrieta, CA – Client Since 2002

The CorrectComp system is a division of Stromsoe Insurance Agency

Why You Need Human Resources for a Small Business | Part 1

Like most small business owners, you’re used to handling all business activities yourself. This includes all human resources tasks. In fact, 54% of small businesses handle HR in house, but owners usually give HR work to staff with little proper training and knowledge to manage employees and properly administrate HR.

If you have over 20 staff, it’s not enough for you to give HR work to someone in finance or operations. Creating your own HR team can improve employee experience and free you to focus on your business.

Improve Your Business with Human Resources Support

HR personnel are experts in handling HR issues, including employee relations and motivation. Your own HR team not only helps you follow employment law; it ensures the health and safety of your staff.

Your HR team can develop policies that lead to employee well-being and engagement, too. The employee satisfaction that HR managers help you create is vital for small business success.

What Is the Role of HR Personnel, Exactly?

Your HR team helps with far more than just dealing with difficult employees and handling employee complaints. They can help you create conditions where staff thrive.

Here are some typical roles your HR department will play.

Ensuring Compliance with Employment Law

HR makes sure your business obeys all local, state and federal employment laws. That includes handling I-9 documents that prove U.S. citizenship for each employee. HR also tackles labor laws. Those include the Family and Medical Leave Act, Americans with Disabilities Act, and the Fair Labor Standards Act.

They maintain employee files, too, making sure all paperwork is always in order. Some paperwork you may need on your staff includes resumes, proof of education and training, work reviews, tax and medical records and more.

You’ll need more documentation if your employees have disabilities or other special needs. Letting your properly trained HR team handle these issues protects your business and helps your small business avoid costly legal problems.

Hiring & Retaining New Employees

Great employee experiences begin with the hiring process. HR works with you to manage hiring new employees. They can also assist with creating methods to attract and recruit the best talent for your business. This includes:

  • writing job descriptions
  • ad placement
  • resume and application gathering
  • interviewing and reference checks
  • job offers

The role also includes managing layoffs and terminations. These procedures have employer regulation implications that HR staff know how to meet.

Employee Training & Development

A positive employee experience goes beyond hiring. How your company onboards, trains and develops employees are key to employee retention. These activities also build your brand reputation as an exceptional employer.

Human resources implements practices and procedures and develops employer-specific resources. They put the best orientation, education and training, and career planning tools in place. They also bring in the right professionals to help. This ensures employees get what they need to stay happy and productive at work.

 

 

Questions? Want to learn more? Here’s 4 easy ways to reach us:

Phone: 951-600-5751
Email: insure@siaonline.com
Text: 951-482-8144
Web: www.siaonline.com

PS Here’s a few words from one client that trusts Stromsoe Insurance Agency:

“For all your insurance needs I highly recommend Stromsoe!”
Matthew Vincent – The Law Offices Of Matthew M. Vincent, APLC – Winchester, CA – Client Since 2019

PPS Every policy is backed by our iron clad, 100% complete satisfaction guarantee. Ask for your copy today!

14 Work Comp Audit Questions, Answered! | Part 2

A work comp audit is the examination of a policyholder financial and payroll records after the expiration of a policy. This process is done to determine the accuracy of the estimated premium when the policy was started. The number one way to fly through an audit is to be prepared!

You should always connect with your independent insurance agent to discuss all questions you have before the audit is conducted.

Here are the next 7 of the most common workers comp audit questions, answered!

 

Q8: Are sub-contractors subject to workers comp premium?

A: True independent contractors normally are not subject to a premium charge. Independent contractor status is determined on a case-by-case basis.

If you use contractors, you will be asked to supply some or all the following: business name, business license, copy of contract, Certificate of Workers’ Compensation Insurance, and contractor’s license number. If a construction contractor has a valid contractors’ license, a valid Certificate of Workers’ Compensation Insurance (if the contractor has employees), or an exemption from workers’ compensation issued by the Contractor’s State License Board, he/she may be considered independent.

You MUST Keep license information and Certificates of Insurance on file, or you will pay additional premium charges.

 

Q9: Why are there two or more classifications for some construction classifications?

Some construction classifications are dual wage classifications. The employee’s base hourly wage rate determines which class code applies. These wage rates are subject to verification at the time of the audit through a valid source, such as timecards, personnel records, and employee earning records. Keeping records that clearly show hours, job duties, and wage rates will allow you to take advantage of the lower-rated dual class.

If you are paying your employees by piecework, you must keep a record of the number of hours worked for each employee to qualify for the lower-rated dual class. If you do not keep a time log of the hours worked, the auditor will divide the total payroll by 40 hours per week to determine an hourly wage rate.

 

Q10: If my employees divide their time between different job assignments, can I divide their payroll between different classifications?

It depends on the classifications. It is important to note that in the case of clerical and outside sales employees, there is no payroll division allowed. There are other class codes that prohibit payroll division as well. If your employee divides time between two or more class codes that allow for payroll division, then you can divide their payroll provided the proper records are kept. This may include timecards or an employee log that keeps track of the hours worked by each employee for each job duty.

Payroll may not be divided by means of percentages, averages, estimates, or any basis other than specific time records.

 

Q11: What is overtime excess and how do I report it?

A: That portion of an employee’s overtime wage, which is over and above, the regular rate of pay is called overtime excess. This includes increased pay for time worked on holidays, Saturdays or Sundays, or the number of hours worked in any week or day beyond the standard for the industry. Overtime excess does not include extra pay for swing or graveyard shifts, for working certain hours on the clock, or incentive or bonus pay figured on volume without regard to hours worked.

Example: If your employee’s hour wage is $10 and the overtime rate of pay is $15 (at time-and-a-half), the overtime excess would be $5. In this example, you pay premium on the $10. An easy way to calculate the overtime excess for the time-and-a-half is to divide the gross overtime by 3 ($15 Divided by 3 =$5)

 

Q12: What is a waiver of subrogation and how do I report it?

A: If you contract with a company that requires you to provide a waiver of subrogation on your workers’ compensation policy, you waive any right to a third-party settlement for injuries to your employees that occur on that company’s job site.

When you have a waiver of subrogation for one or more companies endorsed to your policy, you need to keep track of employee payroll incurred while on the job site of those companies.

You can report your waiver payroll in two ways. First, when completing payroll reports (if applicable), you may use the blank lines below the class codes and list the waiver by class codes. For each class code that has waiver payroll, you would multiply the total waiver payroll by your billing rate and the waiver percentage. This amount is the additional premium you must pay. The second way is to keep the records as noted and wait for the audit.

Example: Your premium for $10,000 at an interim billing rate of $5 per $100 payroll is $500. Multiply the premium of $500 by the waiver rate of 3%. The additional premium charge to cover the waiver of subrogation charge is $15. Your total premium charge including the waiver is $515.

 

Q13: Are payments made to family members subject to premium?

A: Yes, as employees they are entitled to workers’ compensation benefits. 

Special rules apply to family members living in the main household while working on a family-owned farm.

 

Q14: What happens after the audit is completed?

A: You may ask for a full copy of the audit upon completion. Once complete, the audit is reviewed. The results of the audit will be sent to you in the form of a final statement.

What happens if I disagree with the results of the audit?

You should immediately contest the audit in writing with the insurance company. Identify the areas of the disagreement and discuss them with your independent insurance agent or the auditor. You may be asked to supply additional documentation to verify the discrepancy. Please call our agency and the audit supervisor if the matter remains unsolved.

Keeping complete and accurate payroll records is very important and may save premium dollars.

 

If you would like to discuss any aspect that affects your Workers Comp coverage and premium, here are 4 easy ways to reach us:
Phone: 877-994-6787
Text: 951-482-8144
Email: info@correctcomp.com
Web: www.correctcomp.com

Here are some kind words from a business that trusts Stromsoe Insurance Agency:
“I’ve been with Stromsoe Insurance For over 15 Years. Their Murrieta Office was actually my first Project after I got my license. I refuse to go anywhere else! They shop all my policies to save me money and i can talk to everyone with one phone call! I recently Moved to Arizona, and Started a new Company. Stromsoe was able to get me going and again has all my policies! Thx Guys!”
Mike Hughes – Semper Fi Plumbing, Inc. – Surprise, AZ – Client Since 2007

The CorrectComp system is a division of Stromsoe Insurance Agency

The 4 Cyber Attacks Business Owners Need to Watch Out For

More and more purchases are being made online and this transition to a post COVID-19 way of doing business means that safeguarding your company and customer data from cyber attacks is a must. The first step to protecting yourself and your business is to educate yourself on cyber threats. Here are four cyber-attacks to be aware of in order to secure your small business.

1. Phishing

According to the FBI, phishing scans more than doubled in 2020. Phishing strategies are often malicious users posing as a trustworthy source, such as your bank, requesting sensitive information such as your social security number or bank username, password and account number.

Thanks to social media, phishers have had an easier time launching attacks against unwary company owners in recent years. This is due to the fact that the majority of business owners, vendors, and workers post their information on the internet for everyone to see. Phishers can use this to generate highly customized emails and webpages that seem exactly like the sources they’re impersonating. This helps increase the chances of duping business owners and their employees.

2. Drive-By Download

The old mantra of “Just don’t click anything and you’ll be okay” when you stumble across something suspicious, is no longer sufficient. Unfortunately, drive-by downloads make it possible for websites to upload malicious software to computers without you even clicking on anything. The assault is started simply by browsing the website. Drive-by downloads are frequently used in conjunction with phishing emails.

3. Malware

Malware is a generic term referring to harmful software that can infect your computer and collect important information. Malware comes in a variety of forms, which you should be aware of:

  • Adware is a type of malware that is frequently packaged with free or pirated software and is meant to display ads, or pop-ups, while you use your computer’s web browser.
  • Spyware is software that monitors and records your activity, such as keystrokes and websites visited, in order to steal passwords. It might also alter the security settings on your computer.
  • Trojan horses take the form of ordinary files or computer programs. They allow a malicious party access to your computer and data, including your passwords and bank account details, once they’ve been downloaded.

stromsoe-insurance-agency-blog-graphic-cyber-insurance-point-of-sale-machine

4. Point-of-Sale Hacking

Hackers can use this as one of the more high-profile cyber assaults against your small business. A hacker scrapes the credit card information saved on your point-of-sale equipment remotely using this method. This information is typically kept on a PoS device for only a fraction of a second before being encrypted. That microsecond is just enough time for hackers to grab the vital credit card information and transfer it to one or more remote servers.

It is rarely just one credit card number that hackers steal. More often, hackers will gain access to a point-of-sales device and scrape credit card information for months before being detected.

Learn How to Protect Your Business

Every single business is vulnerable to a cyber attack. When you look at some of the largest cyber breaches, you think of large companies. The names that come to mind are Target, Facebook, Google, Marriott…some of the largest corporations within the US have also suffered some of the largest cyber attacks. These are companies that invest millions of dollars into cyber security and the procedures implemented to mitigate those losses. With that being said, a small to midsize business owner is still vulnerable to these kinds of attacks at any time. You might consider these questions and more:

  • Do you collect sensitive data?
  • Are you performing financial transactions?
  • Do you have the ability for human-error?

No matter the security and procedures put into place, if you have a business email and bank account…you are at risk.

Cyber insurance generally covers your business’ liability for a data breach involving sensitive customer information, such as Social Security numbers, credit card numbers, account numbers, driver’s license numbers and health records. Any business that stores sensitive data in the cloud or on an electronic device should be protected by cyber liability insurance.

Cyber insurance can be essential in helping your company recover after a data breach, with costs that can include business disruption, revenue loss, equipment damages, legal fees, public relations expenses, forensic analysis and costs associated with legally mandated notifications.

 

Questions? Want to learn more? Here’s 4 easy ways to reach us:

Phone: 951-600-5751
Email: insure@siaonline.com
Text: 951-482-8144
Web: www.siaonline.com

PS Here’s a few words from one client that trusts Stromsoe Insurance Agency:

“Always there when you need them!”
Kelly Barttels – K Belle, Inc – Temecula, CA – Client Since 2021

PPS Every policy is backed by our iron clad, 100% complete satisfaction guarantee. Ask for your copy today!

14 Work Comp Audit Questions, Answered! | Part 1

A work comp audit is the examination of a policyholder financial and payroll records after the expiration of a policy. This process is done to determine the accuracy of the estimated premium when the policy was started. The number one way to fly through an audit is to be prepared!

You should always connect with your independent insurance agent to discuss all questions you have before the audit is conducted.

Here are the first 7 of the most common workers comp audit questions, answered!

 

Q1: Why am I being audited?

A: Audits are routinely conducted to verify the operations of the insured and to update policy information such as changes in operations, business locations, and new ownership. Audits are conducted to determine correct premium, and to confirm information used for calculating rates. Premium, experience modification, and classification rates are affected by the results of an audit.

 

Q2: What if I have questions regarding my workers’ compensation classifications?

A: The audit is an excellent opportunity to review and confirm proper classifications for the policy. The auditor will speak with the person who is best able to answer questions regarding your operations. It is not recommended that you refer the auditor to your bookkeeper or CPA to finalize the audit.

 

Q3: What records will I be asked to provide for the audit?

A: In general, you will be asked to provide State Quarterly Wage and Withholding Reports (DE 6s), payroll journals, and the payroll reports for the period being audited.

Since the information needed for each audit may differ, you may also be asked to provide other records that relate to your workers’ compensation policy. Examples may include payroll registers, time books, time cards, individual earnings records, check registers, check stubs, check books, cash disbursement journal, cash book, petty cash book, general or subsidiary ledgers, job cost records, confidential records, bonus ledgers, commission ledgers, profit sharing reports, 941s, W-2s, W-3s, 1096s, 1099s-Misc., 540, 1040 Schedule C, certified payroll, prevailing wage determination sheets, etc.

 

Q4: What type of wages and benefits are subject to premium?

Subject to Premium:

A: Premium calculations are based on gross payroll, not net payroll. Gross wages include salaries, commissions, bonuses, vacation, holiday pay, sick pay, overtime base wages, the market value of gifts, all substitutes for money earned or paid during the policy period including meals and lodging in lieu of wages, automobile allowances, and some pension play payments explained below.

Not Subject to Premium:

A: Payroll for officers specifically properly excluded from coverage under the policy, overtime excess (explained later), tips, severance pay, the value of an automobile furnished to an employee, reimbursement for expenses with receipts, and salary reductions to fund the welfare or fringe benefit portion of a Section 125 cafeteria plan.

  • Retirement/Pension Plans-Subject to Premium:
    Any amount by which an employee’s salary is reduced to fund a pension or deferred compensation plan.
  • Retirement/Pension Plans-Not Subject to Premium:
    Employer contributory payments including group insurance, stock purchase plans and qualified retirement plans. The exercise of stock options and withdrawals from deferred compensation plans are also not subject to premium computation.
  • What if I pay my employees in cash?
    If you pay your employees in cash instead of by payroll checks, you must keep a log of the cash payments, the hours worked, the date paid, the amount paid, and the first and last name of the employee. Otherwise, all cash withdrawals on your check register will be included in computing workers’ compensation premium.

 

Q5: Which employees qualify as clerical (code 8810)?

A: The use of this classification is subject to specific restrictions. The clerical employees must be physically separated from all the other working areas and their duties must be confined to general office work. Payroll division with any other class is prohibited.

 

Q6: Which employees qualify as outside sales (code 8742)?

A: Outside sales employees may be engaged in solicitation, collection activities or meeting with clients outside the office. The balance of their time can be spent in the office performing clerical duties. If they have duties of any other nature, they would be classified accordingly. Payroll division with any other class is prohibited.

The auditor will ask for the names, job titles, and payroll for clerical and outside sales employees. Having this information available before the auditor arrives will save time.

 

Q7: How do I report the earnings of our corporate officers, partners, or managing members of limited liability companies?

A: Unless specifically properly excluded by endorsement, officers, partners, or member managers are covered for workers’ compensation benefits. Payroll is reported subject to a minimum and maximum for each person. 

Those covered must be reported in the classification that best describes their job duties. They cannot be reported as clerical or outside sales unless their duties are confined to the work described in these classes. If they directly supervise any employee, they must be reported in the classification supervised.

Be sure to notify your independent insurance agency immediately of any changes in ownership.

 

If you would like to discuss any aspect that affects your Workers Comp coverage and premium, here are 4 easy ways to reach us:
Phone: 877-994-6787
Text: 951-482-8144
Email: info@correctcomp.com
Web: www.correctcomp.com

Here are some kind words from a business that trusts Stromsoe Insurance Agency:
“I’ve been with Stromsoe Insurance For over 15 Years. Their Murrieta Office was actually my first Project after I got my license. I refuse to go anywhere else! They shop all my policies to save me money and i can talk to everyone with one phone call! I recently Moved to Arizona, and Started a new Company. Stromsoe was able to get me going and again has all my policies! Thx Guys!”
Mike Hughes – Semper Fi Plumbing, Inc. – Surprise, AZ – Client Since 2007

The CorrectComp system is a division of Stromsoe Insurance Agency

Your Ultimate Business Insurance Guide

Every business has a custom insurance program because every business has different needs. Business insurance can seem like another language, but there are a few questions you should ask yourself to help determine what would best protect you and your business against your unique risks.

Do You Operate a Business?

The mere fact that you are reading this means the answer to this question is likely yes. The first policy that all businesses should purchase when it comes to protecting themselves and everything they’ve worked so hard for is:

General Liability Insurance (CGL)

From a one-man show to an entire empire, all businesses should have general liability. General Liability protects and defends your business in the event of a claim against you, your employees or your products or services up to your policy limits.

Business Liability Insurance can help your business if:

  • You accidentally damage a customer’s property while on the job
  • A customer slips and falls and gets injured at your business
  • Your business gets sued for slanderous comments you made about a competitor in an interview

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Does Your Business Have Property or Equipment to Protect?

Unless your entire business runs on your personality and know-how, like a business coach for example, you likely have property that you own or rent and some level of equipment that you use.

Commercial Property Insurance

If you own your building or have business personal property, such as office equipment, computers, inventory, or tools, you should think about including coverage on your policy that will cover you in the event of a fire, vandalism, theft, smoke damage, or other disaster. You might also want to add business interruption/loss of earnings protection in your policy to cover your loss of earnings in the event that your company is unable to function.

Business Interruption Insurance

Business interruption insurance is a form of business property insurance that provides money to pay for loss of income because of a covered loss.

Do You Have Employees?

From 1 to 1,000, a business that employs others has a different set of risks. There are certain coverages that are required, and others that are helpful additions to your insurance program.

Workers Compensation (required)

Workers compensation provides insurance to employees who are injured on the job. This type of insurance provides wage replacement and medical benefits to those who are injured while working. As a business owner, it is very important to have worker’s compensation insurance because it protects yourself and your company from legal complications. State laws will vary, but most states require you to have workers compensation if you have W2 employees. Penalties for non-compliance can be very stiff.

Employment Practices Liability Insurance (ELPI)

Employment Practices Liability Insurance (EPLI) is an insurance policy that protects your business against employment-related lawsuits.

The number of lawsuits filed by employees against their employers has been rising. While most suits are filed against large corporations, no company is immune to such lawsuits. Recognizing that smaller companies now need this kind of protection, some insurers provide this coverage as an endorsement to their Business Owners Policy (BOP).

What Does EPLI Cover?

  • Retaliation: Taking a negative action toward a person in response to a protected action or a decision they’ve made. Example – if an employee is terminated for telling a government agency about illegal activity at your company.
  • Sexual Harassment: Workplace sexual harassment is defined as “unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature.” Example – a joking comment that is sexually descriptive in nature with an employee.
  • Discrimination: Making improper or illegal decisions regarding a person’s compensation, promotion or hiring. Example – if an unqualified job applicant is hired because they’re the boss’ daughter.
  • Wrongful Termination: Giving a person an inaccurate, unfairly low or excessively negative performance evaluation. Example – if you make up a false incident report about an employee on a review.
  • Wage and Hour Claims: URGENT – Coverage for wage and hour claims is not included by most policies. Please contact our business insurance team for more details.

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Group Health Benefits

Group health benefits include medical insurance for employees or members of a company or organization. A group health insurance plan typically provides health insurance coverage to its members at a lower cost since the risk to health insurers is spread across the members of the group health plan.

Do You Provide a Service?

Any professional firm including lawyers, accountants, consultants, notaries, real estate agents, hair salons and technology providers, just to name a few, should consider an additional form of insurance.

Professional Liability Insurance

Professional Liability Insurance, also known as Errors and Omissions Insurance, is a policy that provides defense and damages for failure to or improperly rendering professional services. Your general liability policy does not provide this protection, so it is important to understand the difference. Depending on the profession, professional liability insurance may have different names, such as medical malpractice insurance for the medical profession, and errors & omissions insurance for real estate agents.

Do You Sell a Product?

Product Liability Insurance

Product liability insurance can help cover your legal expenses if someone claims that a product you sold, made, or distributed caused an injury or property damage. If you sell, make, or distribute products, you need this policy.

If that product allegedly hurts someone or damages their property, product liability coverage will help pay your legal fees, judgment, or settlement. Anyone can sue over damage from a product, even if they didn’t buy it or use it.

A product liability policy is also crucial for construction and contracting businesses. It offers financial protection when a client sues over a personal injury or property damage related to your completed work.

Other Essential Business Insurance Policies

Commercial Auto & Hired/Non-Owned

A commercial auto insurance policy protects a company’s vehicles. You can insure your company vehicles for liability, comp, collision and more. If you don’t have company vehicles, but employees drive their own cars on company business you should have a non-owned auto liability policy to protect the company in case the employee does not have insurance or has inadequate coverage. Many times the non-owned can be added to the BOP policy.

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Cyber Insurance

Every single business is vulnerable to a cyber attack. When you look at some of the largest cyber breaches, you think of large companies. The names that come to mind are Target, Facebook, Google, Marriott…some of the largest corporations within the US have also suffered some of the largest cyber attacks. These are companies that invest millions of dollars into cyber security and the procedures implemented to mitigate those losses. With that being said, a small to midsize business owner is still vulnerable to these kinds of attacks. You might consider these questions and more:

  • Do you collect sensitive data?
  • Are you performing financial transactions?
  • Do you have the ability for human-error?

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Directors & Officers Liability Insurance

Directors and officers liability insurance applies to anyone who serves as a director or an officer of a for-profit business or nonprofit organization. A directors and officers liability policy insures against personal losses, and it can also help reimburse a business or nonprofit for the legal fees or other costs incurred in defending such individuals against legal action.

 

Questions? Want to learn more? Here’s 4 easy ways to reach us:

Phone: 951-600-5751
Email: insure@siaonline.com
Text: 951-482-8144
Web: www.siaonline.com

PS Here’s a few words from one client that trusts Stromsoe Insurance Agency:

“Amazing staff! Jennifer and Vanessa were very detailed and were able to acquire the perfect insurance policy for our business! Thank you again!“
Travin Griepenstroh – Unique Ultrasound – Temecula, CA – Client Since 2015

PPS Every policy is backed by our iron clad, 100% complete satisfaction guarantee. Ask for your copy today!

Does Your Business Insurance Travel with You?

Does your business insurance coverage properly protect you and your business for events and other operations away from your primary business premises? As businesses continue to reopen and we are all once again able to fill our networking calendars with events, it’s important to discuss your policies with your protection coach to ensure you are properly protected.

General Liability Insurance

A general liability policy protects your business from financial loss should you be liable for injury or property damage to others caused by your services, business operations or your employees. You should talk to your business insurance coach to ensure that your policy extends to an event away from your business premises to properly protect yourself and your business when attending networking events, tradeshows, mixers and the like.

Workers Compensation

Workers comp protects the employee and the employer for payment of medical bills for covered injuries sustained on the job & loss of earnings resulting from covered injuries sustained on the job. If your business operations will cross any state lines, make sure to discuss the details with your business coach to make sure your business is protected.

Equipment Coverage

This is where coverage talks can get tricky, because equipment coverage will vary from insurance company to insurance company. Equipment coverage for property away from your primary business premises may or may not be included in your policy. It’s best to call your protection coach and have a conversation about your particular needs and situation.

 

Questions? Want to learn more? Here’s 4 easy ways to reach us:

Phone: 951-600-5751
Email: insure@siaonline.com
Text: 951-482-8144
Web: www.siaonline.com

PS Here’s a few words from one client that trusts Stromsoe Insurance Agency:

“Thank you, Thank you, Thank you SIA. My business has rapidly grown, but I couldn’t have managed without you. You take the worry out of my insurance needs and that makes me extremely happy. Your entire staff is very knowledgeable and friendly. I would never go anywhere else for my business insurance.“
Robert Siever – Gasket Pro – Costa Mesa, CA – Client Since 2014

PPS Every policy is backed by our iron clad, 100% complete satisfaction guarantee. Ask for your copy today!