In most states, if you have employees, you need workers’ compensation insurance. Workers’ compensation insurance helps pay medical bills, lost wages, and disability benefits if one of your employees is injured or becomes ill on the job.
Different states have different methods for obtaining workers’ compensation insurance. There are three options:
- Monopolistic states (must go through state fund)
- States with state funds as an option
- Private insurance companies
How to get workers comp insurance in monopolistic states?
There are four states that require everyone to go through the state fund in order to obtain workers’ compensation insurance. They are:
If you live in one of these states, obtaining workers’ compensation is easy since you only have one option. They differ a little in how you go about getting it, though.
How to get workers comp insurance in North Dakota?
The provider in North Dakota is the North Dakota Workforce Safety & Insurance.
You can complete the application for insurance online. Once they receive your application, an underwriter will contact you.
North Dakota uses its own four-digit code system to classify employees (as opposed to the National Council on Compensation Insurance (NCCI) codes that most other states use).
How to get workers comp insurance in Ohio?
Ohio’s state fund is called the Ohio Bureau of Workers Compensation. You can either complete an application online or mail a hard copy to them. Ohio classifies employees based on the NCCI classification system.
How to get workers comp insurance in Wyoming?
Wyoming requires employers to get insurance through the Wyoming Department of Workforce Services. Classification is based on the North American Industry Classification System, a six-digit code. You can find your employees class codes on the website.
How to get workers comp insurance in Washington?
You must obtain workers’ compensation insurance through the Washington State Department of Labor and Industries. Businesses must obtain a business license and create an account to apply for insurance.
How to get workers comp insurance in states with a state fund as an option?
These states also have a state fund, but you’re not required to purchase insurance through it: it exists only as an option. Usually, the state fund is more expensive, but it’s a good option if you’ve been denied coverage by other insurers. Difficult-to-insure professions may need this option.
These states are:
- Arizona
- California
- Colorado
- Louisiana
- Maryland
- Missouri
- New York
- Pennsylvania
- Rhode Island
- South Carolina
If you live in one of these states, you can get a quote from the state fund and compare it to quotes from other companies to see which offers the best deal.
How to get workers comp insurance in Texas?
Texas is the only state in the union that doesn’t require workers’ compensation insurance. However, if you don’t have this coverage, you leave yourself open to lawsuits from injured employees, some of which may be very costly. Employers in Texas should still consider getting workers’ compensation insurance to protect themselves and their employees.
How to get workers comp insurance from insurance companies?
There are 3 types of insurance companies that you can get workers comp insurance from. Each has their own advantages and disadvantages:
- Traditional insurance companies
- Online insurance companies
- Digital insurance brokers
- How to decide the best way to get workers comp insurance for your company?
- How to find the best workers comp insurance companies in your state?
- How to get cheap workers compensation insurance?
How to get workers comp insurance from traditional insurance companies?
Most traditional insurance companies offer workers’ compensation insurance. The top 10 insurance companies by market share are.
- Travelers – See our review of Travelers business insurance
- The Hartford – See our review of the Hartford business insurance
- Zurich –
- Chubb – See our review of Chubb business insurance
- Liberty Mutual – See our review of Liberty Mutual business insurance
- Berkshire Hathaway – See our review of Geico business insurance; and Biberk small business insurance review, another small business insurance in Berkshire Hathaway family
- AmTrust – See our review of AmTrust small business insurance
- AF Group
- Old Republic
- AIG – See our review of AIG business insurance
Most of the big-name insurance companies offer a variety of policies and coverage limits for you to choose from. They have the benefit of years of experience. Some of these companies allow you get quotes online, although usually, you have to work through an agent to purchase the policy. See our in-depth analysis of the strengths and weaknesses of these top 10 workers comp insurance companies in the country.
How to get workers comp insurance from online insurance companies?
There are many insurance companies these days that allow small business owners to purchase insurance online. The danger of purchasing workers’ compensation insurance without the benefit of an agent is that you might misclassify your employees and wind up paying more than you should. However, these online companies often provide you access to their agents if we prefer discussing your situation with a knowledgeable agents.
Some of these companies include:
- biBERK – see our review of biBERK small business insurance
- Huckleberry – see our review of Huckleberry small business insurance
- Next – see our review of Next Insurance
- Hiscox – See our review of Hiscox small business insurance
- Pie – See our review of Pie small business insurance
- Vouch – See our review of Vouch small business insurance
- Cerity
The advantage of these companies is that they usually offer online quoting, and once you get a quote, you can purchase the policy online, and insured the same day. Many allow you to pay month-to-month which makes it easier for budgeting and is probably more accurate since it’s based on your actual payroll instead of a projection. Prices may be lower as well since they don’t have to worry about paying agents.
How to get workers comp insurance from digital insurance brokers?
There are also companies that are not insurance companies at all but help you by giving you several quotes from their insurance partners. CoverWallet, Pogo, PolicySweet, ez.insure, Embroker, and commercialinsurance.net are tsuch companies. They usually make it easy to compare a few quotes, so comparison shopping between companies is easier and faster.
How to decide the best way to get workers comp insurance for your company?
Consider what’s most important to you. Some factors to consider are:
- Price
- Convenience
- Customer service
- Financial strength
- Customer satisfaction
Do some research and find which company suits your needs the best. Compare online quotes and get quotes from at least three companies. Read consumer reviews, so you don’t discover a company is difficult to work with later on.
Make sure you understand your state’s requirements regarding workers’ compensation insurance. States differ in what they expect.
Lastly, some companies are better at insuring some industries than others. Research what others in your field have to say about a particular company. Risk appetite is the degree to which a company is willing to accept the uncertainties and risks of particular professions. If you work in construction, you’ll want to find a company that knows the risks involved and realizes you may have claims.
How to find the best workers comp insurance companies in your state?
You can research the insurance companies offering workers comp insurance in your state and compare them on the attributes that are important to you. The problem is that there are so many companies offering workers comp insurance in each state. It can be up to 50-60 companies. We have done the homework and recommend you the 4-7 best workers comp insurance companies in the most popular states:
- California – The best workers comp insurance companies in California
- Forida – The best workers comp insurance companies in Florida
- Texas – The best workers comp insurance companies in Texas
- New York – The best workers comp insurance companies in New York
- New Jersey – The best workers comp insurance companies in New Jersey
- Pennsylvania – The best workers comp insurance companies in Pennsylvania
- Colorado – The best workers comp insurance companies in Colorado
- Georgia – The best workers comp insurance companies in Georgia
- Massachusetts – The best workers comp insurance companies in Massachusetts
- Illinois – The best workers comp insurance companies in Illinois
- Arizona – The best workers comp insurance companies in Arizona
- Michigan – The best workers comp insurance in Michigan
- Ohio – The best workers comp insurance in Ohio
- North Carolina – The best workers comp insurance in North Carolina
- Maryland – The best workers comp insurance in Maryland
- Oregon – The best workers comp insurance in Oregon
- Minnesota – The best workers comp insurance in Minnesota
- Louisiana – The best workers comp insurance in Louisiana
How much does workers’ compensation insurance cost?
If you know what you’re doing, workers’ compensation insurance is fairly straightforward. The formula is:
Employee Classification Rate X Employer Payroll (per $100) X Experience Modification Rate = premium
The employee classification rate refers to over 700 class codes that describe various jobs. The rates vary between a few cents per $100 and up to $2.25 per employee per $100 of payroll. You can find the workers’ compensation rates by class code here.
The higher the risk of injury, the more you’ll pay. Office workers pay much less than roofers and construction workers. Rates per $100 are somewhere between $0.55 and $2.25.
The modification rate refers to how safe your workplace has been and if you’ve ever had a workers’ compensation claim. Workers’ compensation insurance costs can go down over time due to the modification rate. The longer you go without a claim, the less you’ll pay.
>>MORE: How Much does Workers Comp Insurance Cost?
How to get cheap workers compensation insurance?
Small businesses are able to choose their own workers’ comp insurance provider in most states. You owe it to yourself to compare coverage and costs from several insurers. They have different ways of calculating premium costs and you will likely find a range of prices. You can select one that offers you the coverage you need at the best possible cost.
In addition, if you establish the safety programs at your workplace and have your employees follow all safety standards, you will be able to get discounts on workers comp insurance premiums each year.
Lastly, remember to ask for any additional discounts that each insurance company offers. Discounts are usually offered through any association or groups that your company is a member of. And whenever possible, choose to bundle your workers comp insurance policies with other related business insurance policies to earn additional discounts.
>>MORE: The Cheapest Workers Comp Insurance Companies
What does workers comp insurance cover?
Workers compensation insurance is required by most states (except Texas) for good reason. It protects both the employer and the employee if something happens, and the employee is injured or fall ill. It covers:
- Medical care
- Lost wages
- Disability benefits
- Job re-training if they are unable to return to their previous job
- Death benefits
Without workers compensation insurance, you, as the employer, would have to provide the employee with all those benefits.
Workers compensation is generally no-fault insurance, meaning it doesn’t matter whose fault it was the employee got injured.
Last thoughts
Almost every state requires you to purchase workers’ compensation insurance for employees. Make sure you understand your state’s laws, and then purchase insurance from a company that respects your values.
