Workers' compensation insurance rates are based upon the "classification" of the employees to be covered. The classification refers to the type of work the individuals perform. Insurance companies establish a premium rate for each classification. However, there are often many adjustments to these basic rates.

Since 1983 Michigan has had competitive pricing of workers' compensation insurance. In many states an insurance bureau sets uniform rates that insurance companies are required to follow in selling workers' compensation insurance. In Michigan insurance rates are now set on a competitive basis in the marketplace.

Because insurance companies do not all charge the same rate for the same workers' compensation coverage, it is very important for a business, either directly or through its insurance agent, to shop around for the best price on workers' compensation insurance. In shopping for insurance price is a very important consideration but an employer should also inquire concerning the services that the insurance company will provide. This includes the services concerning claims as well as prevention and loss control.

The Michigan Economic Development Corporation provides assistance to employers in helping to reduce their workers' compensation insurance costs.  You can find out more information about their programs by clicking here (MEDC) or calling them at 1-888-522-0103.