Most state laws require employers to purchase workers' compensation insurance. A business's payroll is one of the primary factors for calculating what is charged (referred to as "premium"). Since the payroll/premium connection exists, a relationship between ECI and workers' compensation insurance providers makes great sense! Our payroll-billed program enables employers to take a hands-off approach to paying their workers' compensation insurance because WE do all the work. Business owners benefit by saving time AND money through significant cash-flow advantages such as:
- Zero down payment (this is 100% true for Guard; other carriers charge some form of up-front payment, such as the expense constant of $200)
- No installment fees
- Payments drafted following each payroll check date (that could mean 52 premium installments a year if your payroll cycle is weekly)
- Premium audits become MUCH easier because payroll information has been provided to the insurance company during the term of the policy
- No need to worry about late payments because premiums are remitted electronically -- on time, all the time.
Here's How It Works
Traditionally, the payroll used to calculate workers' compensation premiums is estimated at the beginning of a policy period. Once the policy period ends, payroll figures are then audited, and the up-front premium which was charged is reconciled to actual payroll. (The audit can result in money owed to the insurance company or returned to the policyholder.) With payroll-billed workers' compensation, current, actual wage information is provided to the insurance company through ECI each pay period. The insurance company then uses your data to automatically calculate the workers' compensation costs and directly debit your specified bank account. It's simple, accurate, and allows you to retain the advantage of your own cash until the exact amount of premium is due.
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