Learn about workers’ comp insurance with more frequently asked questions about our coverage.
If you don't find the answers you’re looking for, our licensed insurance advisors are standing by to help.
Does Workers’ Compensation cover business interruption?
Worker’s compensation does not cover business interruption.
Business income interruption is a type of property insurance that covers the loss of income that a business suffers after an unexpected event, such as a fire or snow storm. It is included in NEXT’s commercial property coverage.
For example, if a wind storm hits your city and a tree falls on your shop, business interruption insurance can help cover lost income.
Does Workers’ Compensation cover my subcontractors?
Workers’ compensation generally does not cover subcontractors because they are not your employees.
However, in some states for some industries, subcontractors may be classified as your employees if they don't carry their own workers compensation.
In that case, you must report their payroll as your employees.
Workers’ compensation is regulated by each state. Many states have subtle differences in the requirements. It’s important to carefully read your policy documents.
I'm the owner of the company. Am I covered by workers’ compensation if I'm injured on the job?
Injuries to business owners can be covered by optional business owners’ coverage in workers’ comp.
If you’re the owner of the company and you trip and break your hand at your work site, you could be eligible to get help with your medical bills and lost wages.
Personal health insurance might not cover medical fees for work-related injuries — especially if you’re in the construction industry — so getting workers’ comp for yourself as a business owner offers you an extra layer of protection.
Who is exempt from Workers’ Compensation insurance?
Every state except for Texas requires workers’ comp for employees.
However, each state also typically has a short list for who is exempt from having coverage. It’s important to check the insurance requirements where you work.
Some states don’t make it a requirement for certain types of workers to have workers’ comp, such as:
- Agricultural employees
- Domestic workers
- Real estate employees
- Coaches for children’s teams
Be sure to check the exemptions in your state before you decide to buy workmen compensation insurance or not.
Do business owners without employees need to buy workers’ compensation?
If you’re a business owner without any employees, you are probably not required by law to have workers’ compensation, particularly if you’re a sole proprietor, partner or LLC member.
However, that might not be the case for more regulated industries, such as construction.
Even if it’s not legally required, you could still be asked by your clients for proof of insurance.
Having a certificate of insurance for workers’ comp lets clients know you have coverage if you get injured while working for them.
Do contractors need Workers’ Compensation insurance for themselves?
If you’re a sole proprietor or independent contractor without any employees, you usually aren’t required by law to get workers’ comp.
However, the construction industry is often regulated differently and you might be required to have coverage before you take any jobs.
Regardless if it’s required by law, it can be a good idea to have an active workman's comp policy. If you get sick or injured on the job, workers’ comp would help cover medical bills and some of your lost wages.
If you’re a sole proprietor or independent contractor with employees, you’ll probably need to get workers’ compensation for them unless you work in Texas.
Learn more about workers’ compensation for contractors.
What’s the difference between Workers’ Compensation and disability insurance?
Workers’ compensation only provides financial help for injuries that happen at work.
Disability insurance covers injuries that happen outside of work and is divided into short-term and long-term disability.
It is the employer’s responsibility to pay for workers’ compensation insurance, and it’s usually required by law.
Disability insurance is typically optional and costs are often shared between the employer and employee.
Learn more about the differences between workers’ compensation and disability insurance.
Does workers’ compensation pay disability benefits?
Workers’ comp benefits are separate and distinct from disability benefits.
If a work injury results in a permanent injury that renders you unable to return to work, workers’ comp may pay some kind of permanent injury benefits, but it varies from state to state.
You’ll need a workers’ compensation doctor to verify that your disability was caused by your work conditions, and that your disability is not going to improve. This is called “maximum medical improvement,” or MMI.
If an employee injures their after lifting too many heavy boxes at your moving company and can’t work anymore, a doctor will rate the disability (stated as a percentage) and determine the degree of permanent limitation.
Permanent total disability means you can’t return to work at all in any field.
Permanent partial disability refers to a lasting impairment that sticks around after the initial injury or illness, such as hearing loss. These types of cases are common workers’ comp injuries.
How is workers’ compensation different from health insurance?
Workers’ compensation can cover medical expenses and lost wages after an accident at the workplace.
Health insurance covers personal injuries and ailments that happen outside of work.
Health insurance will cover many of your medical expenses, but it won’t cover any lost wages while you’re recovering after a workplace injury.
Learn more about the differences between workers’ comp and health insurance.
