A recent national survey of restaurant decision-makers finds that they
place too much emphasis on the price of their workers’
compensation insurance, potentially forgoing the long-term financial
benefits of accident prevention and other loss control measures.
The survey results, released by Employers Holdings, Inc. (EMPLOYERS)
(NYSE:EIG), whose subsidiaries specialize in insurance for small
businesses, found that most workers’
compensation insurance decisions are made by restaurant owners
themselves (96% of the time). The survey also found that price is the
key criterion that drives the workers’
compensation decision for 71% of restaurant owners and managers—and
that restaurants are more likely than other small businesses to switch
carriers based on price.
While nearly half of all restaurant survey respondents reported having
had at least one costly workers’ compensation
claim in the past five years, 61% of survey takers who switched carriers
at their last renewal switched because of price—and
no restaurant owners participating in the survey reported switching
carriers to obtain more effective loss
control and safety program support.
“Price can logically serve as a deciding
factor in many restaurant purchases, but when it comes to workers’
compensation insurance, a carrier’s claims
management, financial strength, safety and loss control expertise can
bring added value,” noted Martin Welch,
President and Chief Operating Officer of Employers Compensation
Insurance Company and Employers Insurance Company of Nevada, insurance
subsidiaries of Employers Holdings, Inc. (EMPLOYERS).
Both the price sensitivity and busy schedules of restaurant owners are
recognized by trade groups and industry associations which frequently
ally with insurance carriers to offer association members group
incentives, industry-specific expertise, and loss control programs.
Restaurant decision-makers in the survey weighed their trade group’s
recommendation as extremely important (rated 9 or 10 on a 1-10 scale)
when they purchase workers’
compensation insurance.
