Business of Medicine


Should You Buy Insurance Through Your Payroll Provider?

Utilizing a payroll company to ensure accuracy and save time can be beneficial for many practices. However, utilizing this same company for related services such as workers’ compensation insurance – a move that may save time, but usually doesn’t provide value to the practice – is another story.

Why? The inclusion of other services can be likened to add-ons at a car rental company.  Added services, such as a collision damage waiver, fuel service option, or daily GPS rental, markedly increase the car rental company’s profit margin. Similarly, the addition of workers’ compensation insurance, while convenient, likely comes at a higher cost than if purchased independently.

Here are some questions practices should consider:

  1. What is the annual cost for your workers’ compensation insurance alone?
  2. Does your payroll provider’s program offer a dividend?
  3. What loss prevention/OSHA support is provided?
  4. What employer’s liability limits are provided?
  5. What is the provider’s experience modification rate?
  6. What would your practice’s experience modification rate be if calculated individually?

While purchasing your workers' compensation insurance through your payroll provider might be the best option for you practice, we encourage you to consider the above when making that decision. 


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The information provided in this resource does not constitute legal, medical or any other professional advice, nor does it establish a standard of care. This resource has been created as an aid to you in your practice. The ultimate decision on how to use the information provided rests solely with you, the PolicyOwner.