Workers’ Compensation Insurance for Small Businesses

Hopefully, your employees stay healthy and never have to use this coverage, however, understanding workers’ compensation insurance can help protect your employees and business. When you have workers’ compensation insurance coverage through ADPIA, licensed agents can work with you to help you submit your claim to your carrier. Employers benefit from purchasing workers’ compensation insurance because it helps protect their business against potential lawsuits related to workplace injuries. California, for instance, requires insurance even if you only have one employee, while coverage in Florida is mandatory if you have at least four employees. In Alaska, some businesses are allowed to self-insure and avoid purchasing insurance if the state approves their situation.

In these situations, they may be eligible for workers’ compensation benefits. Understanding workers’ compensation coverage is important to protect your employees and your business. Workers’ compensation insurance generally pays for the rehabilitation, recovery or medical bills of employees’ work-related injuries, as well as lost time due to a work-related injury. Workers’ compensation insurance is not a substitute for health or medical insurance — employees are only covered for on-the-job injuries. Unemployment insurance is a type of insurance protection that’s traditionally provided to those who’ve unexpectedly lost their jobs and are unable to find new work immediately. Each state administers its own unemployment insurance program and funds most of the program through tax dollars.

The Basics of Unemployment Insurance

However, it’s important to check with your state’s unemployment benefits program before beginning the application process. Without workers’ compensation insurance in place, you may be at risk of fines for not complying with your state’s insurance regulations. Additionally, if an employee runs into a problem that would’ve been covered by workers’ compensation insurance, you may be responsible for covering their expenses and adp claims may be sued by the employee. No matter how safe your business is, there’s always the chance an employee can get injured or sick while on the job.

Common questions about Workers’ Compensation

Independent contractors and 1099 workers may also need coverage depending on contractual requirements or state laws. The necessity for coverage can depend on factors like the size of the business, the type of work being performed, and state-specific legislation. Workers’ compensation insurance covers employees’ medical expenses after a workplace injury or illness. It may also replace the employee’s wages if he or she is unable to work while recovering or offer rehabilitation services if needed.

Work with ADPIA to understand your specific obligations and options regarding subcontractors and workers’ compensation insurance. The ADPIA Licensed Agent was very helpful with our Workers’ Comp policy. She was quick to respond, knowledgeable about our policy coverages and offered additional insight. She provided documents immediately and ensured all my questions were answered. I wish all my ancillary business interactions were as quick, concise and productive.

Laws and regulations regarding workers’ compensation vary by state and circumstances. Employers should consult a licensed insurance agent to understand specific coverage requirements. It is designed specifically to cover employee-related injuries and illnesses that occur due to or in the course of employment. A business owner’s policy (BOP) is a separate type of policy that provides coverage for lost income and additional expenses when a business is affected by a covered event. Of clients prefer having their workers’ compensation premium payments spread across their payroll cycle (vs. having an upfront deposit). To navigate these complexities, consider consulting a licensed ADPIA agent for a workers’ compensation quote and effective claims and risk management strategies to help control costs.

Unless your state says 1099 contractors aren’t required to have coverage, it’s a good idea to include them in your policy. My ADPIA Licensed Agent is quick to respond to our requests and stays on top of any issues that may arise and has taken really good care of our account. If something doesn’t look right to her, she will reach out and confirm it.

ADPIA can help you develop and execute a timeline for an effective open enrollment. We provide the tools and support you need to minimize paperwork, answer questions and help your employees better understand the full value of their benefits. Once the degree of disability has been determined, injured workers receive a percentage of their average weekly wage (actual or state average) for the previous year. Most states require that benefits be paid for the duration of a worker’s disability, but some specify a maximum time period.

Contact a business insurance agent.

Also, most states enforce a waiting period before benefits for a temporary disability are distributed, though these vary by state, and there are exceptions. 1 While premium deposits may be eliminated with most carriers, mandatory state assessment fees may be required in some states. Nearly every state requires business owners to have coverage for their employees, but all states have varying regulations.

• Nearly all states require employers to carry workers’ compensation insurance as soon as they hire an employee, though each jurisdiction is unique.
• In most states, workers’ compensation insurance is required for companies with one or more employees.
• ADPIA’s Insurance Inspector tool5 leverages AI technology to help you catch errors and other compliance risks that could cost you time and money.
• Start the process by gathering all the paperwork you need and by checking out your state’s requirements.

An ADPIA-licensed agent can help you learn more about the laws in your state. Generally, workers’ compensation insurance requirements apply to businesses that have employees. If you are a sole proprietor without employees, you are not typically required to carry workers’ compensation insurance. That said, sole proprietors should consider obtaining coverage, especially if they operate in a high-risk industry.

Health Benefits (Group Health)

• Additionally, if an employee runs into a problem that would’ve been covered by workers’ compensation insurance, you may be responsible for covering their expenses and may be sued by the employee.
• Aclaimant insights seamlessly integrates artificial intelligence (AI) and machine learning (ML) into your workflows to provide you with better decision-making ability in real-time.
• In exchange for receiving these benefits, employees waive the right to sue the business owner for the incident.

You can apply for Adult Disability Payment online or by phone and paper. Start the process by gathering all the paperwork you need and by checking out your state’s requirements. If possible, file your application online, because this is usually the fastest way to get your claim submitted. However, depending on your state, you may also file a claim in person or over the phone.

Workers’ compensation insurance for small businesses

The cost depends on the risk-level of the work; for instance, it’s more expensive to purchase insurance for construction workers than it is for receptionists. Our licensed agents can check with the carrier to see what issue may have led to the notice. Visit carrier websites for the necessary claim forms and fill them out completely to avoid delays in processing time. When speaking with a provider or insurance carrier, be sure to document the conversation for reference if questions arise. Make the most of your healthcare dollars by doing your homework before an appointment – for example, calling the carrier to make sure services are covered. 3 While premium deposits may be eliminated by most carriers, mandatory state assessment fees may be required in some states.

What is covered?

The process to sign up for workers’ compensation also depends on the location of your business. Some states recommend you purchase through private insurance companies, while others require you to buy it through a state-run insurance fund. Workers’ compensation insurance provides workers who are hurt or sickened on the job with all medically necessary and appropriate treatment. However, many states have adopted measures to help control expenditures. They may enforce utilization management guidelines describing which treatment protocols and diagnostic tests are acceptable for specific injuries. Each state has specific exemptions for those who don’t need to carry workers’ compensation insurance.

Unemployed individuals can receive benefits, typically for up to 26 weeks, while they look for work. In addition, an Extended Benefits program has been established that provides additional benefits, typically up to 20 weeks, in states where unemployment is high. While you can file for unemployment insurance with a simple application, getting approved for these benefits may be a bit more complicated. It’s important to know if you qualify, understanding which paperwork you need to gather, and learning how to get through the process. Workers’ compensation insurance coverage typically includes full-time and part-time employees (W-2 workers), but the specific requirements can vary by state.