If you own a plumbing business in Minnesota, having the right Workers’ Compensation (Work Comp) insurance is a very important part of protecting your plumbing business It is also likely one of your largest expenses. Work Comp protects your employees if they get injured on the job by covering medical expenses, lost wages, and rehabilitation costs. In Minnesota, businesses with employees are required to carry Work Comp insurance.
How Work Comp Insurance is Priced for Plumbers
Work Comp insurance premiums are based on payroll and classification rates. Each type of work is assigned a specific rate per $100 of payroll, determined by historical risk and claims data.
For Minnesota plumbers, the state-assigned Work Comp rate is $4.38 per $100 in payroll. However, many private insurance carriers offer lower rates. For example, one of our top business insurance carriers, we’ll call them ABC Insurance, offers a base rate of $2.58 per $100 in payroll—a significant savings. This is the base work comp insurance rate. For qualified Minnesota Plumbing Businesses, there are additional discounts available for previous claims history, years in business, security measures in place, other business lines of business with the company I’ve created some examples for actual work comp insurance cost below. Not included in these examples are some of the fees associated with Workers Compensation policies.
Work Comp Insurance Cost Examples for Plumbers
To help illustrate how premiums are calculated, here are examples based on different payroll amounts:
Example 1: $10,000 in Plumbing Payroll
- Minnesota State Plan Rate ($4.38 per $100)
- Premium: $10,000 ÷ 100 × $4.38 = $438 per year
- ABC Insurance Rate ($2.58 per $100)
- Premium: $10,000 ÷ 100 × $2.58 = $258 per year
Example 2: $100,000 in Plumbing Payroll
- Minnesota State Plan Rate ($4.38 per $100)
- Premium: $100,000 ÷ 100 × $4.38 = $4,380 per year
- ABC Insurance Rate ($2.58 per $100)
- Premium: $100,000 ÷ 100 × $2.58 = $2,580 per year
How to Lower Your Work Comp Costs
If you have employees, you are required to carry workers compensation insurance. This is a mandatory additional expense, however there are ways to control your costs:
Choose the Right Carrier – A competitive carrier like ABC Insurance can significantly reduce your premium compared to the state plan.
Implement Safety Programs – Fewer injuries mean fewer claims, which can lead to lower premiums over time.
Review Your Payroll Classifications – Ensure your employees are classified correctly to avoid overpaying.
Consider a Dividend Plan – Some policies offer dividends, meaning you get money back based on claim performance.
Get a Quote for Your Plumbing Business
At Ameriguard Insurance, we specialize in helping Minnesota plumbers find the right Work Comp coverage at the best rates. If you’re currently on the state plan or paying too much, let us help you find a better workers comp solution for you.
Contact us today 763-767-0522 for a free consultation and quote!