Why Lawn Care Pros Overpay for Workers’ Comp — And What You Can Do to Lower Your Premiums
If you’re in the lawn care or landscaping business, workers’ compensation insurance is one of those essentials that costs you money most likely regardless, if you catch my drift. Year after year, rates seem to creep up — or feel like you’re sending too much to your bottom line versus your competitors. The truth is, many lawn care business owners do overpay for their workers’ comp, simply for reasons they can directly fix.
In this article, I’ll walk you through the most common reasons lawn care business owners overpay for workers’ comp insurance — and how to leverage tested strategies to get the best competitive rate without sacrificing coverage.
???? 1. Misclassifying Employees: A Hidden Premium Killer
The first — and generally most neglected — reason why lawn care companies overpay is misclassifying employees on their workers’ comp policy. Most owners lump everyone into a broad, high-risk group like “tree trimming,” which carries a much higher rate than “landscaping” or “lawn mowing.” Even one or two workers in the wrong classification will raise your premium by hundreds or even thousands a year.
How Employee Classifications Affect Premiums:
Each state assigns a rate for different job classifications — typically per \$100 of payroll. For example:
- Lawn mowing and basic landscaping might rate around \$5 per \$100.
- Tree work could rate \$20 per \$100 — 4x as much.
If all of your workers are coded as tree trimmers because someone overlooked proper classifications at your last renewal, you’re paying those higher rates across the board.
Quick Fix:
Work alongside your insurance broker or a Certified Workers’ Compensation Advisor (CWCA) to go through your policy. Verify the actual day-to-day operations your crew is conducting — and that they’re coded correctly. A lot of states allow multiple classifications if you can demonstrate you split payroll accordingly. Even having separate payroll accounts for mowing and pruning will save you a fortune.
????️ 2. Inadequate Safety and Return-to-Work Programs
Insurance companies don’t just take into account what you do — they also take into account how safely you do it. Without a written safety program, regular safety training, and a return-to-work policy for workers’ injuries, you’re leaving discounts on the table that can reduce your premiums and boost your experience modification rate.
✅ Why Safety Training Matters
When you can demonstrate proactive safety practices — like weekly toolbox meetings, safety manuals, PPE policies, and employee certification — insurers consider you a better risk. Some insurers and several states offer scheduled credits (discounts) simply for having such programs.
✅ The Impact of Return-to-Work
When an employee gets hurt, a successful return-to-work program can mean the difference between a “lost-time” and a “medical-only” claim. Why?
- Medical-only claims normally impact your experience mod at 70% less than lost-time claims.
- Keeping an individual on light-duty work — even for a partial duration — enables the insurer to settle the claim sooner and reduce its overall impact on your rates.
Quick Fix:
Develop a simple return-to-work policy and talk with your agent about adding a safety program. Most insurance companies have free safety training resources — so ask them what they offer.
???? 3. Shopping Around for a New Policy Every Year
This one is a surprise for many owners. Hopping from one insurer to another each time you renew may make you feel that you’re being responsible — but underwriters do not necessarily see it that way. Insurers check the history of a company like you scrutinize a new client.
Suppose you quote a lawn care client who tells you upfront, “I always get three estimates every year.” That type of client is communicating they move between providers and might not be willing to pay for loyalty or long-term deals. Would you give that customer your best possible rate? Not on your life.
Why Loyalty Pays:
Going back to the same carrier has a way of earning you extras like:
- Preferred pricing
- Renewal discounts at lower rates
- Safety dividend programs
- Waived audits or fees
- Simpler underwriting process
- A better relationship if you do have a claim
Quick Fix:
Rather than jumping to the lowest-cost carrier each year, review and tweak your policy terms with your agent year after year. Demonstrate to the underwriter that you’re interested in a long-term relationship — and they’ll usually reward you with better rates and discounts.
???? 4. Missing Scheduled Credits and Discounts
Insurance companies want your business — especially if you’re proactive. Many offer “scheduled credits” or discounts for things like:
- Implementing safety manuals
- Providing ongoing safety training
- Being part of a trade association
- Staying claims-free for a number of years
Quick Fix:
Prior to your next renewal, have your carrier or agent review your account for pending credits you may not be receiving. Even a 5% or 10% discount can make a big difference on a $50,000 policy.
???? 5. Bad Experience Modification Factor (MOD)
Your modification of experience rate — commonly referred to as your “MOD” — will make or break your premiums. The MOD is like a report card the insurance company issues you based on your previous losses in comparison to others in your line of work.
- MOD less than 1.0? You get a discount.
- MOD greater than 1.0? You pay a surcharge.
And what causes that MOD to rise most frequently? Lost-time claims and too many small claims submitted in rapid succession.
Quick Fix:
Invest in return-to-work training to reduce claims. When accidents do happen, use your return-to-work program to keep them medical-only. And sit down with your agent every year to review your experience mod worksheet — correcting errors can drop your rate immediately.
???? 6. Allowing Injured Workers to Sit at Home Too Long
When someone on your team gets hurt, it’s tempting to say, “Just go home and take some time off.” But under most state workers’ comp systems, the longer an employee stays home collecting indemnity (wage-replacement) benefits, the worse your claim looks — and the higher your experience mod.
Quick Fix:
Be prepared with light-duty tasks for injured workers who have lesser injuries — simple shop work, filing, safety training videos, light equipment repairs — anything to get them on the clock. Even working a claimant part-time can reduce the dollar loss of a claim by thousands and improve your MOD.
???? 7. Failure to Review Payroll and Audits
Your workers’ comp premium is based mainly on your estimated payroll. But when did you last check over your audit at the close of the policy year with attention? Numerous firms underreport or misclassify payroll — and, surprise, surprise, overpay as a result.
Quick Fix:
Double-check your audit carefully at the end of the policy period. When you see errors — like overtime credited in full, or a crew chief misclassified into a higher class — report those errors to your carrier. Even small changes can lead to a refund check.
???? 8. Not Working with a Specialist Who Knows Lawn Care
That’s the trick — generalist agents typically don’t know the lawn care business well enough to catch mistakes or negotiate reductions. An expert who deals with landscapers and lawn professionals on a daily basis will:
- Know all applicable class codes
- Know which insurance companies would be interested in your account
- Help you implement safety and return-to-work programs
- Negotiate for credits and discounts that belong to you
???? Key Takeaways — How to Stop Overpaying for Workers’ Comp:
✅ Classify your team correctly — review payroll codes
✅ Have a safety and return-to-work program in place — fewer claims
✅ Be faithful to a good carrier — better rates over time
✅ Review your policy every year — find errors and request discounts
✅ Get a specialist who understands lawn care — they will represent you
By making these simple, proactive moves, you’re in control. Instead of biting the bullet for your next workers’ comp renewal, you can plan for predictable premiums, less surprise — and more cash in your pocket.
???? Need Help Getting Started?
If you’d like someone else to take a look at your workers’ comp setup — or would like to see how much money you can save — I’d be happy to help. I specialize in working with lawn care companies to assist them in controlling their insurance costs and walking them through the workers’ comp process.
Contact me at Safenet Insurance Group for a free policy review. Let’s get you properly classified, insured, and only paying for what you’re actually supposed to have.
*(And if you enjoyed reading this article, do share it with one of your fellow lawn pros — let’s make sure that we all stop overpaying for insurance!)