Pay-As-You-Go Workers' Comp
Pay workers' comp with each payroll run, not a year in advance
Traditional comp asks you to guess twelve months of payroll, hand over a deposit, and settle up at audit. Pay-as-you-go bills premium from the payroll you actually ran — which is better for cash flow and much harder to get wrong.
Why owners switch
Same carriers, same coverage, same claims team. The only thing that changes is how and when the premium is calculated.
No large down payment
Traditional comp policies often want 25% of estimated annual premium up front. Pay-as-you-go typically starts with little or nothing down — the money stays in your operating account.
Premium follows your season
If you run four crews in July and one in January, your premium moves with the payroll instead of billing a flat twelfth of an estimate every month.
Fewer audit surprises
Because reported payroll is actual rather than estimated, the year-end audit reconciles to something close to zero instead of producing a five-figure invoice.
One less thing to remember
Premium is calculated and withdrawn with each payroll run, so there is no separate installment to track or accidentally miss.
Cleaner cash flow forecasting
Comp becomes a predictable percentage of payroll — a variable cost that scales with revenue instead of a fixed bill you owe whether or not you are busy.
Same coverage, same carriers
This is a billing method, not a lesser policy. You get the same A-rated carriers, the same benefits, and the same claims handling.
The math, in plain terms
Say your estimated annual comp premium is $24,000. A traditional policy might want $6,000 down and eleven installments. If you overestimated payroll, you financed money you did not owe all year. If you underestimated it, the audit arrives with a bill in the thousands that nobody budgeted for.
With pay-as-you-go, that same coverage costs a percentage of each payroll. Slow month, smaller draft. Busy month, larger draft. The total for the year lands where it should have all along — you just were not carrying the timing risk.
Common questions
See what pay-as-you-go looks like for your payroll
Send us your class codes and payroll and we will quote it both ways, side by side.