For employers across North America, workers’ compensation premiums are one of the most significant controllable expenses in their operating budgets. Premiums are designed to reflect risk—companies with higher injury rates pay more, while those with better safety records are rewarded with lower costs. In today’s competitive business environment, every dollar saved on insurance can be reinvested into growth, wages, or innovation.
The challenge? Reducing premiums requires more than reacting to accidents—it requires proactively preventing them. That’s where online safety training has emerged as a powerful, cost-effective solution.
As Rick Finemann, Vice President of Loss Control at Berkshire Hathaway Homestate Companies, explained, in a recent sit down I had with him:
“The dollars tied up in claims are staggering, but the real cost is in the human impact and the productivity you lose. That’s why prevention is always more powerful than paying claims after the fact.”
By embedding online training into their safety programs, employers can reduce accident frequency, improve compliance, and build a safety culture that lowers claims—and with them, workers’ compensation premiums.
How Workers’ Compensation Premiums Are Calculated
To understand how training affects premiums, it helps to first understand the formula. In both the U.S. and Canada, workers’ compensation systems look at several key factors:
- Industry classification: High-hazard industries like construction or trucking start with higher base rates.
- Payroll size: More workers means more potential exposure, so premiums scale with wages.
- Experience Modification Rate (EMR or MOD): A performance score that compares an employer’s claim history to others in the same industry. An EMR of 1.0 is average; below 1.0 indicates fewer claims and results in discounts, while above 1.0 means surcharges.
- Claim frequency and severity: Both the number of claims and the cost of those claims matter. A single catastrophic loss or repeated minor injuries can drive premiums up.
Online safety training directly influences the most controllable part of this equation: claims frequency and severity.
Why Online Safety Training Matters
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Reducing Accidents Before They Happen
Every claim avoided is a premium dollar saved. Online training equips workers to recognize hazards and follow safe procedures, whether it’s preventing a fall, handling chemicals properly, or avoiding distracted driving.
As Finemann noted:
“If all you do is wait for claims, you’re behind the curve. Training gets you upstream—it stops accidents before they hit your balance sheet.”
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Building Compliance and Avoiding Penalties
Regulators in both countries require employers to train workers on specific topics—hazard communication, PPE, confined space entry, WHMIS, and more. Failure to comply not only increases accident risk but can also lead to fines, which indirectly affect workers’ comp costs by inflating claim severity and drawing scrutiny from insurers. Online training libraries keep employers aligned with evolving standards automatically.
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Creating a Culture of Safety
Workers’ comp premiums don’t just reflect injuries—they reflect organizational culture. Companies with robust, trackable training programs demonstrate to insurers that they are serious about prevention. Over time, this reduces MOD scores and secures more favorable rates.
Finemann reinforced this cultural point:
“Our job isn’t just to underwrite risk—it’s to shape it. Employers have that same opportunity. When they use training to change how people think and act on the job, premiums follow.”
The ROI Of Online Safety Training
While the upfront cost of an online safety training platform might range from a few dollars to a few hundred dollars per employee per year, the return is almost immediate when compared against the cost of claims.
- The National Safety Council estimates the average direct cost of a lost-time injury is over $40,000.
- In many provinces, just one claim can raise an employer’s EMR enough to increase premiums for three years or more.
Compare that to an online training subscription that might cost $199 annually per employee. Preventing even a single recordable injury delivers a return on investment many times over.
Benefits Beyond Premiums
Productivity Gains
Trained employees make fewer mistakes, handle equipment properly, and return to work faster if incidents occur. That reduces downtime and keeps operations moving.
Employee Morale and Retention
Workers are more engaged when they know their employer values safety. Strong safety cultures reduce turnover, which also reduces onboarding costs and further stabilizes insurance premiums.
Defense Against Claims
When claims do arise, documentation matters. An LMS creates a digital record of training completion that employers can use to demonstrate due diligence. This evidence can limit liability and reduce claim severity in litigation.
Case Examples: Training And Premium Impact
- Trucking Fleet: After implementing online distracted driving modules, a regional fleet saw collisions drop by 30%. Over the next renewal cycle, their EMR dropped from 1.25 to 0.98, saving more than $250,000 in annual premiums.
- Manufacturing Plant: A plastics manufacturer rolled out eLearning on chemical safety and machine guarding. Injury frequency fell by 40% over two years, cutting their workers’ comp surcharge by 20% and making them eligible for a safety group dividend.
- Construction Firm: By integrating online fall protection and ladder safety training, a mid-sized contractor reduced fall claims from six in one year to just one the next. Their EMR moved below 1.0, earning them preferred status with both insurers and clients who require strong safety records.
Practical Steps For Employers
- Assess Your Loss History: Identify the top drivers of your workers’ comp claims—slips, back injuries, vehicle incidents—and prioritize training in those areas.
- Deploy an LMS: Use a learning management system to assign, track, and document completion of courses. This not only proves compliance but also highlights training gaps.
- Engage Supervisors: Combine online learning with short, in-person toolbox talks led by supervisors to reinforce lessons in context.
- Track and Adjust: Monitor training completion and compare it against incident data. Over time, you’ll see where more reinforcement is needed.
The Long-Term Payoff
Online safety training is not just about avoiding one or two claims—it’s about changing the trajectory of your workers’ compensation costs. With consistent use, employers can lower EMRs, qualify for rebates or dividends, and improve their competitive position in bidding for contracts (many of which now require proof of strong safety records).
As Finemann summarized:
“I’ve seen firsthand that when training is easy to access, incidents fall. It’s not theoretical—it shows up in the numbers, in fewer claims, and in lower premiums.”
Conclusion
Workers’ compensation premiums are a reality of doing business, but they don’t have to be an uncontrollable burden. Employers who embrace online safety training have a proven path to reduce claims, lower EMRs, and unlock significant savings. Beyond the financial impact, they gain safer workplaces, stronger cultures, and a reputation as employers of choice.
In a competitive marketplace where margins are thin, the message is clear: online safety training is not just an HR tool—it’s a financial strategy. And for employers who want to protect their people and their bottom line, it may be the smartest investment they can make this year.
