Is your broker helping—or just handling?
Smart Workers’ Compensation Strategies Your Business Might Be Missing
Managing workers’ compensation insurance isn’t just about having a policy in place. Even if your broker is responsive and “gets the job done,” you may still be missing opportunities for smarter planning and meaningful savings. A strategic broker doesn’t just handle paperwork, they help you think proactively about how your coverage is structured and how it affects your bottom line.
We’ve seen too many businesses overpay for years simply because no one ever showed them how to approach workers’ comp strategically. This isn’t about cutting corners, it’s about better classifications, stronger documentation, and clearer coordination between your accountant, payroll provider, and insurance broker.
Below are a few common areas where we regularly help clients reduce premiums and lower audit risk:
Payroll Allocation
In industries like construction, manufacturing, and healthcare, employees may perform duties under different class codes. When that happens, you may be able to split their payroll proportionally, but only with accurate time tracking and documentation.
Here’s what’s needed:
- Clear job descriptions
- Timecards or tracking systems that record hours by activity type
- Consistent categorization across payroll systems
Modern tools like QuickBooks Time or TSheets allow for this kind of category tagging. Without this level of detail, carriers typically won’t accept split payrolls during an audit.
Example: An HVAC technician spends 60% of their time on service and repair (≈$4 per $100 of payroll) and 40% on clerical work (≈$0.12 per $100). Allocating time correctly could significantly reduce your premiums—but most businesses miss this opportunity because their broker never brought it up.
Classification Reviews
Job roles change. If your business has added new positions or shifted responsibilities in the last 12–24 months, it’s time to review your current class codes.
Without up-to-date documentation, carriers will often default all payroll to your highest-rated class code, resulting in inflated premiums.
Common issues we uncover:
- Office staff misclassified in high-risk categories due to vague job titles
- Subcontractors misclassified or lacking Certificates of Insurance
- Outdated codes carried over from earlier business phases
Example: A construction firm may have roofers ($5.06 per $100), window installers ($3.15), and sales reps ($0.27). Without clear tracking, everyone might be lumped into the $5.06 category—significantly increasing your premium.
Audit Support
Many business owners dread their annual workers’ comp audit. But your broker should help you prepare before the auditor even calls.
Brokers support clients by:
- Reviewing payroll and class code accuracy ahead of time
- Organizing subcontractor documentation (like COIs and 1099s)
- Flagging seasonal hiring patterns to align projections with actuals
Clients have reduced audit adjustments by thousands just by cleaning up a few items beforehand.
Coordination With Your Accounting Team
This is where great strategy comes together: when your insurance broker and accountant talk to each other.
When they’re aligned, you get:
- Fewer audit surprises through shared classification strategies
- Better forecasting for both taxes and premiums
- Cleaner labor cost data for pricing, staffing, and planning decisions
Final Thought: Is Your Broker Asking the Right Questions?
If your broker isn’t talking to you about classifications, payroll allocation, or audit preparation, it’s worth asking:
- Do they know how your employees actually spend their time each week?
- Have they ever reviewed your subcontractor setup?
- Are they coordinating with your CPA—or just sending renewal forms?
- Have they ever explained what to expect during a workers’ comp audit?
Smart workers’ compensation strategy doesn’t mean more work for you. It means having the right partner who’s doing more behind the scenes so you don’t have to.
Rates referenced are based on published data from the Kansas Division of Workers’ Compensation and the Kansas Department of Insurance.
About the Author
This article was written by Dallas Owens, a partner at Iron Insurance Partners, where he leads strategic risk management for growing businesses across Kansas and the surrounding region. With a practical, client-first approach, Dallas helps business owners rethink traditional insurance relationships, bringing smarter strategies, clearer communication, and stronger results.
To learn more about how Iron Insurance Partners can support your business, visit ironrisk.com or reach out to Dallas directly.
