Check’s Workers’ Compensation Insurance Go-to-Market Playbook

Workers’ compensation insurance is a form of insurance providing wage replacement and medical benefits to employees injured in the course of employment. Payroll and workers comp are deeply intertwined: most states require workers comp insurance as soon as an employer hires their first employee, and insurance premiums are calculated at least in part using payroll amounts. As such, legacy payroll providers have been incorporating workers comp into their product suite for over 30 years, and it is an established product offering your payroll sales representatives can easily bring up during the payroll sales conversation.

This playbook provides Check’s prescriptive guidance for selling workers comp insurance. We will cover several key Go-To-Market (”GTM”) areas, including:

Workers comp insurance is a type of insurance policy that provides benefits to employees who are injured or become ill as a result of their job. This insurance policy is designed to protect both the employer and the employee by providing financial assistance to cover medical expenses, lost wages, and other related costs.

Workers comp insurance is typically required by law in most states as soon as an employer hires their first employee. The regulatory-required coverage provided by a workers comp policy varies depending on the state, but typically includes benefits for medical expenses, disability payments, and rehabilitation costs.

When an employee is injured on the job, they can file a claim with their employer's insurance company to receive compensation for their medical expenses and lost wages. In exchange for receiving benefits under workers comp insurance, employees generally waive their right to sue their employer for negligence or other claims related to the injury or illness.

Workers comp premiums are calculated using a number of inputs, but one of the main ones is payroll expense. There are two main types of plans: pay-as-you-go (PAYGo) workers comp insurance and yearly audit workers comp insurance. Pay-as-you-go workers comp insurance allows businesses to make premium payments in real-time based on their actual payroll amounts, while yearly audit workers comp insurance requires businesses to estimate their payroll amounts at the beginning of the policy term and make a lump-sum payment for their workers comp insurance premiums, adjusting at the end of the year as necessary.

In considering offering workers comp insurance as part of your payroll line of business, it is critical to understand the various stakeholders involved with the workers comp industry and individual claims. Comprehending the stakeholders involved in workers comp enables your team to make informed decisions, offer appropriate coverage, build strong relationships, and create a safer and more secure work environment for their employees.

There are 4 common customer scenarios your sales team will encounter when an employer needs to discuss healthcare insurance:

Of the above, you should primarily focus your GTM around new workers comp plans and workers comp plan Broker of Record switches, doing your best to avoid PEO scenarios. If a business is starting payroll for the first time, your sales reps should always push your workers comp solution as an assumed packaged opportunity. For all other scenarios, the employer should already have a workers’ comp policy established so focusing on the value positions your solution delivers as well as how easy it is to switch Broker of Records should dominate your communication towards your clients.

This section will empower your sales representatives to ensure they are capturing the maximum amount of workers comp cross-sells as possible.

Note that this guide assumes that you do not have any existing licensure to sell workers comp insurance and that you are only selling to workers comp prospects who are interested in running or currently live running payroll.

Prospects who already have PAYGo workers comp insurance will understand the value of making you the Broker of Record for their existing insurance; namely, this BOR transfer will allow them to keep their existing policy in place while moving to your payroll platform. The messaging in these situations is therefore (1) that you have the ability to offer PAYGo workers comp insurance and subsequently (2) all the key benefits of why your payroll offering is better than other offerings.

Thus, the vast majority of the messaging you will be focused on for workers comp concerns the value of moving off of a yearly audit payment plan to PAYGo. Note that a Yearly Audit plan can often be converted to a PAYGo plan in the middle of the policy term length, so always push the merits of transitioning to a PAYGo plan facilitated via your payroll product regardless of the existing plan the customer uses.

PAYGo workers comp insurance is considered superior to traditional yearly audits for several reasons:

For payroll prospects: With the clear value propositions listed above, the payroll sales representative should end every closed-won payroll sales opportunity with:

"Do you want to incorporate pay-as-you-go workers comp with your payroll? There's no cost, it takes one quick signature, and [INSERT VALUE PROP] [example:]it prevents a large premium payout during your audit.”

This opening pitch will prompt either a quick yes or a specific objection, which Check recommends you log into your CRM. However, the most important follow up question to a hard no from a prospect is “when is your workers comp plan renewal? I would love to show you our options then.” This question allows your marketing team and sales representatives to segment your payroll based on future campaigns.

For existing payroll customers: Having your payroll contact reach out regarding your plan is not surprising to an employer given the tight relationship the two systems have. The primary talk track for existing payroll customers is:

“I am reaching out to discuss our pay-as-you-go workers comp offering. There's no cost, it takes one quick signature, and [INSERT VALUE PROP] [example:]it prevents a large premium payout during your audit."

The objections your sales representatives will have with existing payroll customers match what new payroll customers will say and the follow up question of renewal is applicable too.

For payroll prospects: Employers know the connection between payroll and workers comp. Hosting a public facing page dedicated to your workers comp product outlining the value points above with a Call-to-Action to speak with a payroll sales representative will help drive overall payroll sales.

For existing payroll customers: We recommend you either 1) Add an “Insurance” tab into your core product website or 2) Add an Insurance section on the Payroll page in your core product. Both options should outline the value points above, with option #2 being much more abbreviated. Both options should have a Call-to-Action of integrating their payroll with a PAYGo plan.

For all payroll prospect marketing campaigns, we recommend that you briefly mention one of the above value points in any outreach to remind payroll prospects that you have this offering. A good example is the following: “Our payroll offering plus integrated benefits like Pay-as-you-Go Workers Compensation… [rest of statement about your key payroll differentiators].”

Regarding dedicated marketing campaigns for workers comp to existing payroll customers, we recommend that you primarily target customers with content 1-2 months prior to their workers comp renewal date. This content should be both email and in-product via strategically positioning banners, pop-ups, and other product-leg growth options to directly prompt your payroll customer to switch their workers comp policy to one that runs through your payroll system.

In between surfacing workers’ comp to payroll prospects and months before current payroll clients policy renewal date, you should send soft reminders of your workers comp offering 4 to 8 times per year (roughly, every other month to every month excluding the renewal period). This content should mainly be added to other current payroll customer engagement content but can be a dedicated campaign as well.

The main input into how often and how directly you should market workers’ comp to current payroll clients depends on how many other competing products you have to market; higher product count should include workers’ comp along with other secondary product marketing, while lower product count can have more worker’s comp specific marketing.

Businesses will purchase their workers' comp plan either when they first form their business entity along with their other insurance services or when they hire their first employee. Therefore there are no seasonal considerations to workers comp outside of the renewal period.

This lack of seasonality is the core reason why it is so imperative that your sales representatives are asking and logging renewal dates into your CRM so you can drive targeted campaigns that are relevant to each customer throughout the year.

The more data you can add to your CRM for payroll and the connected systems, the more effective a sales motion you will have. By adding these select fields to your CRM you can target customers with data-driven outreach campaigns, keeping your messaging relevant and moving clients through the sales funnel more effectively.

Fields to add:

Knowing these aspects of your clients will allow your sales team to create dynamic and focused outreach strategies to drive high workers comp attach rates.

Our recommended health GTM motion can be found in this Whimsical diagram. This offers step-by-step guidance for how to navigate different types of workers comp insurance prospects from initial interest through deal completion.

Check offers out-of-the-box How to Sell Workers Comp training for reps that can be issued via Trainual. Please reach out to Check with which reps you would like to assign the training to.

If a client simply needs a new Broker of Record to switch off their current payroll provider onto your system, then an insurance carrier has already opted-in to underwriting their workers comp policy and there are no DQ considerations your team needs to assess.

If you have a prospect who is needing a new workers comp policy or is in a renewal period, there are a couple of considerations you should keep in mind prior to guaranteeing the prospect can utilize your workers comp solution.

The workers comp broker model you decide to move forward with will inevitably be the decision maker on these critical considerations.

Non-licensed sales representatives for workers comp may not be legally allowed to provide specific details or answer certain questions related to policy terms and coverage. These questions typically require expert knowledge and licensing to ensure compliance with insurance regulations.

If a sales rep gets asked questions around any of the areas listed below, their response should be “Workers comp is a licensed insurance policy, and I cannot legally provide you those answers. I will take down all of your questions and have my licensed workers comp broker respond back to you shortly.”

Here are some examples of questions that a non-licensed sales rep may not be able to answer:

It's important to note that the limitations on what a non-licensed sales representative can answer may vary depending on local laws and regulations. In some jurisdictions, there may be stricter regulations regarding the information non-licensed representatives can provide. Therefore, it is always advisable to consult a licensed insurance professional for accurate and detailed information regarding workers comp policies.

For payout of your sales representatives, Check recommends a flat fee of $150 / plan setup on our workers comp strategy. This dollar amount is significant enough that it will motivate a sales rep to ask about workers comp on every payroll deal, but small enough where they won’t push closing the opportunity too much. It also provides reps with straight forward commission math. If they sell 10 deals a month and half add on workers comp, they just made $750 of extra commission for very low lift.

Workers comp insurance is a type of insurance policy that provides benefits to employees who are injured or become ill as a result of their job. This insurance policy is designed to protect both the employer and the employee by providing financial assistance to cover medical expenses, lost wages, and other related costs.

Workers comp insurance is typically required by law in most states in the United States. The regulatory required coverage provided by a workers comp policy varies depending on the state, but typically includes benefits for medical expenses, disability payments, and rehabilitation costs.

A workers comp insurance premium is the amount of money that an employer pays to an insurance company to provide coverage for work-related injuries and illnesses. The premium is based on a number of factors, including the size and type of the business, the industry the business operates in, the number of employees, the company's claims history, and the state in which the business operates.

To calculate the premium, the insurance company will typically use a formula that takes into account the company's payroll, the type of work that employees do (referred to as Class Codes), and the company's past workers comp claims. The premium is usually calculated as a percentage of the company's payroll, with the exact percentage varying depending on the type of work that employees do.

Workers comp insurance premiums are often connected to payroll because the premium is typically calculated as a percentage of the employer's payroll. This is because the amount of payroll an employer has is often a good indicator of the number of employees they have and the amount of risk associated with the work they perform.

The premium calculation takes into account the classification code assigned to the employer's business by the state's workers comp insurance rating bureau. Each classification code has a different rate based on the perceived risk of injury associated with the type of work performed. The rate is then applied to the employer's payroll to determine the premium.

Pay-as-you-go workers comp insurance and yearly audit workers comp insurance are two different methods of premium calculation and payment for workers comp insurance policies.

Pay-as-you-go workers comp insurance allows businesses to make premium payments in real-time based on their actual payroll amounts. With this method, businesses typically work with a payroll provider or insurance carrier that integrates workers comp insurance premiums into their payroll processing. This allows businesses to make payments based on their actual payroll amounts, rather than paying a lump sum at the beginning of the policy term. This method can help businesses manage their cash flow and avoid unexpected premium adjustments at the end of the policy term.

Yearly audit workers comp insurance, on the other hand, requires businesses to estimate their payroll amounts at the beginning of the policy term and make a lump-sum payment for their workers comp insurance premiums. At the end of the policy term, an auditor will review the business actual payroll amounts and make any necessary adjustments to the premium payment based on the difference between the estimated and actual payroll amounts. This method can be more time-consuming and administratively burdensome for businesses, but it allows for a more accurate premium calculation based on actual payroll amounts.

Overall, pay-as-you-go workers comp insurance offers businesses more flexibility and accuracy in premium payments, while yearly audit workers comp insurance offers a more accurate premium calculation based on actual payroll amounts but requires more administrative work upfront and at the end of the policy term.

According to the National Council on Comp Insurance (NCCI), the average workers comp insurance premium for all industries in the United States was $1.43 per $100 of payroll in 2020. This means that for every $100 of payroll, a business could expect to pay an average of $1.43 in workers comp insurance premiums.

The average cost of workers’ comp insurance falls between $0.75 to $2.74 per $100 of payroll.

Employers may have several objections or concerns when considering moving their workers comp insurance onto a payroll provider's PAYGo offering. Here are some common objections and possible reasons behind them:

It's crucial for employers to engage in open discussions with the payroll provider, clarify any concerns or objections, and seek detailed explanations and evidence to address their specific reservations. This allows for a better understanding of the benefits and drawbacks of moving to a pay-as-you-go workers comp insurance model and helps employers make informed decisions.