Yes is the simple answer. The rate you are charged is based upon your past safety record. The term in the insurance industry to define this is called an experience modification. This number starts off in the beginning at 1. So if your premium for workers’ compensation is $20,000, you mutiple the $20,000 by your experience modification which is 1 and you get a premium of $20,000.
Now let us say you have been in business for 3 years with no accidents your experience modification may now be .75. So $20,000 times your experience modification of .75 means you will only pay $15,000 in premium. That is a $5,000 savings. Conversely, if you have a bad safety record your experience modification maybe 1.5. In that case, your premium would be $30,000. $20,000 times your experience modification of 1.5. So it is clear to see manging your employees safely is not only the right thing to do but will also save you significant money on premiums in the future.