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Why preparation is the key to business success

The key to success in any business is preparation. By taking time to consider the pros and cons of each critical move, a business can avoid the pitfalls that can come about through unanticipated circumstances. This can be especially important in terms of protecting the business from legal obligations that can come through a workers’ compensation claim

Part of this preparation comes with making sure that an adequate reserve is available to pay out claims that may come about. From a purely financial standpoint, a work comp claim should be seen as a legal obligation that must be paid. Because of this, businesses should be careful not to underestimate the amount they should hold in reserve.

The consequences of having an inadequate reserve may be obvious, but they are worth mentioning. Anything not covered by the business’ workers’ comp insurer may be borne by the company. If these costs exceed what the company brings in, the challenges may be too great for the business to bear. This may lead to tough decisions that the company may make going forward, and may be fatal to the business.

As such, having a detailed conversation with an experienced workers’ compensation attorney can help in making sure that the business has an adequate claim reserve to compensate work comp claims. Moreover, the advice of a lawyer can help in incorporating systems and policies that reduce the likelihood that an employee will be injured, which may create the workers’ comp claim in the first place. 

Source: “Why under reserving can lead to problems” July 3, 2014

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