Workers' Compensation is the Last Nail in the Coffin for Small Businesses; PEO7 Survey Finds
Posted on: Tuesday, 14 July 2009, 13:51 CDT
CALABASAS, Calif., July 14 /PRNewswire/ -- According to a recent survey conducted by www.PEO7.com, Workers' Compensation rates are rising throughout the nation, pressuring businesses to find alternatives as they struggle to survive. For example, in the state of California, Workers' Comp rates increased 6% in January 2009, and are slated to increase another 24% in July.
With financial woes mounting, the State has proposed selling State Insurance Fund, which is the Workers' Compensation provider of last resort for small businesses. Though the insurance commissioner has objected to such proposal, it points to even higher rates in the future, regardless of the sale.
The Workers' Compensation issue has been further exacerbated by AIG suffering major losses in 2008, sending their workers' compensation rates spiraling higher. Many AIG policy holders were left with no coverage and scrambled to find lower Workers' Comp rates, but to no avail.
While the current economic downturn shows no immediate signs of improvement, Professional Employer Organizations (PEOs) are proving to be a lifesaver for many small businesses.
PEOs are able to offer lower costs because of their innovative business model. A PEO administers payroll, workers' compensation, human resources, and employee benefits to a large number of companies, thus qualifying for much lower rates on a wide range of insurance products. These savings are then passed on to the clients.
The national economic crisis has begun to highlight the advantages of PEO Employee Leasing service providers. The lower rates that PEOs offer for costs such as Workers' Comp, healthcare, and unemployment are deciding factors for many businesses as they struggle to survive our current economic conditions, providing innovative options and saving businesses as much as 30% on their overall administrative costs.
As the economic climate worsens, www.PEO7.com anticipates that more and more businesses will take a closer look at the cost benefits of Employee Leasing PEO Services. Ironically, in this economic environment, outsourcing of administrative functions to PEOs finally makes sense.
About PEO7.com
www.PEO7.com is the largest PEO broker in the US, connecting companies seeking PEO employee leasing services with some of the finest PEO services in the nation. PEO7 offers a great deal of information on its website at www.PEO7.com with a PEO blog at www.peo7.net.
Contact: David Sheehan 818-444-2400SOURCE PEO7.com
Source: PR Newswire
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