If you own a business in New York, you probably already know that rates for workers compensation insurance are the highest in the country. Workers compensation insurance pays for medical costs should your employee become injured or fall ill while on the job. It’s required in New York, so you should consider getting a quote from several companies. Here are our top six picks.
- Top 6 Providers of Workers Compensation Insurance in New York
- Workers Compensation Laws in New York
- What Happens If I Don’t Have Workers Compensation Insurance in New York?
- Factors Affecting Your Workers Compensation Insurance Rates
- How Much does Workers Compensation Insurance Cost in New York?
- How to Find Cheap Workers Compensation Insurance in New York?
- What does Workers Compensation Insurance Cover?
- How does Workers Compensation Insurance Differ from General Liability Insurance?
Top 6 Providers of Workers Compensation Insurance in New York
We crunched the numbers and studied more than 10 insurance companies providing workers compensation insurance in New York state. Here are our recommendation of the top 6:
- New York State Insurance Fund (NYSIF): Best Overall
- The Hartford: Best for free additional coverages
- Biberk: Best for online quotes and purchase; and excellent financial strength
- Pie Insurance: Best for online quotes and purchase; and positive consumer reviews
- Huckleberry: Best for online quotes and purchase
- Hiscox: Reputable insurance specialist in small businesses
New York State Insurance Fund (NYSIF): Best Overall
NYSIF is the largest insurer in the state of New York. Their mission is to provide the lowest possible rate for workers compensation insurance to employers and to provide timely indemnity and medical payments to injured workers. You answer ten questions and they can provide you with a quote. Questions include things like:
- Estimated payroll
- Prior workers compensation insurance information
- Personal information
NYSIF is particularly good to get a quote from if you’ve had issues in the past, such as past claims or if you work in a high-risk industry.
The Hartford: Best for free additional coverages
We couldn’t get a quote from the Hartford, but there’s usually pretty competitive and are at least worth a look. They have thousands of positive reviews from happy small business owners, and if you need additional insurance, they have many small business policies. They add things to your policy that other companies charge for, such as extended filing and stop gap coverage. Read our review of the Hartford Small Business Insurance
Biberk: Best for online quotes and purchase; and excellent financial strength
Biberk specializes in small business insurance. You can get a quote, pay, and get covered in less than ten minutes. They have thousands of positive reviews, and the rock solid financial strength that comes from being part of Berkshire Hathaway. The quote below is for a café in Albany with five employees and $160,000 in payroll.
Pie Insurance: Best for online quotes and purchase; and positive consumer reviews
Pie has excellent reviews on Trustpilot with an average score of 4.6 out of five stars. Most of the reviews praise how easy it was to get insurance and how helpful and responsive the sales people were. You can get a quote online or you can call, if you prefer. They cover lots of different industries, and their rates are competitive.
Huckleberry: Best for online quotes and purchase
Huckleberry is a relatively new company, but they’re backed by Markel, which has been in business since 1930. It’s easy to get a quote, and you can pay online and be insured in minutes. They cover lots of different industries, with optional coverages that include liquor liability, spoilage coverage and more.
The following is a ballpark estimate. You’ll know it’s official when you see a button that says “Pay now.”
Hiscox: Reputable insurance specialist in small businesses
Hiscox is America’s leading small business insurer, or so they tell us. They have many policies available, so you can find whatever insurance you need. They offer online quoting, but since we don’t have an actual business we had trouble getting one. You can call and talk to an agent if you prefer or have questions.
Workers Compensation Laws in New York
Like almost every state, workers compensation insurance is mandatory if you have one employee or more. The only exceptions are sole proprietors or business partners without employees, although you can buy it for yourself.
New York is also a no-fault insurance state, which means it doesn’t really matter whose fault it was that your employee injured themselves at work, they still receive benefits.
Part-time employees also count and you must get workers compensation insurance to cover them. You don’t need to get workers compensation for independent contractors, but the contractor has to not be under the employer’s control.
What Happens If I Don’t Have Workers Compensation Insurance in New York?
If you have five employees or fewer, you will be subject to a fine between $1,000 and $5,000. If you have more than five employees, it’s a felony and your fine will be somewhere between $5,000 and $50,000. If you say you have five employees when you really have seven, that could result in a fine of $2,000 for every ten days of noncompliance.
Factors Affecting Your Workers Compensation Insurance Rates
A lot of different factors affect how much you pay for workers compensation.
- State laws
- Type of business
- Level of risk
- Prior experience
- Claims history
According to Workers Compensation Shop, the rates for a café in New York range from a low of $2.06 to a high of $4.02 per $100 of payroll. The industry that you’re in is the biggest factor, since the more risk your employees are exposed to, the more money you’ll pay.
If you’d like a formula to figure out your workers compensation rate, it’s roughly:
Class code x experience modification rate x payroll = premium
The experience modification rate reflects things like how many years you’ve been in business and how many workers compensation claims you’ve filed in the past.
You’re probably wondering how you figure out what your experience modification rate is and how to calculate it. There’s a handy rate calculator at Optimum Safety Management.
How Much does Workers Compensation Insurance Cost in New York?
Workers compensation insurance is required in New York state if you have any employees at all.
The good news if you’re a New York employer is that workers compensation rates have gone down and are now at $1.41 per $100 of payroll. You multiply that by the class code dollar number, and then multiply that by the number of employees you have.
Some examples of what you’ll pay for different occupations by class code:
- Jewelry manufacturing: $0.53
- Bookbinding: $3.15
- Road construction: $13.74
- Asbestos Contractor: $29.64
- Clerical: $0.13
- Healthcare: $4.53
For a complete list of class codes in New York State, click here.
This means that if your company operate a clinic. For every $100 payroll you pay your healthcare employees working in the clinic, you have to pay $4.53 in workers compensation insurance. This can get really expensive for companies in road construction or asbestos contracting, so be sure to shop around with a few companies or a digital broker like CoverWallet so that you can compare several quotes before deciding on the cheapest one for your company.
How to Find Cheap Workers Compensation Insurance in New York?
You probably already know that workers compensation insurance is the most expensive in New York. It can be a significant cost to your business. Not having workers compensation insurance can result in even more costly consequences. Make sure you follow the tips below to get the cheapest workers compensation insurance for your company in New York.
- Always compare several quotes: Make sure you shop around with a few insurance companies or a digital broker to compare several quotes to get the cheapest one for your business
- State programs: Check if there is any state savings program in New York that your business can be qualified for.
- Group insurance: if your company is a member of a larger association, you may be able to get a group rate on your company’s workers compensation insurance.
- Identify potential hazards and fix them. Once you fix them, make sure you notify your insurance agent (if you have one) or report it to your company. Continue improving the safety standard in your company’s workplace and ask for annual reviews when you need to renew your company’s workers comp insurance.
- Invest in safety education. According to Safety and Health, for every dollar you spend on injury prevention, you’ll earn a ROI of between $2 and $6 dollars. If you’re wondering how to start a safety program, OSHA (Occupational Safety and Health Administration) is a good place to start. After starting the program, you need to make sure to obtain the qualification certificate from the program administrator. Showing the certificate to your workers compensation insurance insurer or agent can help reduce the cost when you renew the policy.
- Check classification levels. Every employee type is assigned a classification level, and each level is assigned a rate that reflects the level of risk this type of job has. Obviously, a secretary is exposed to much less risk than a construction worker, even if they work at the same company. Make sure everyone is classified accurately and regularly update this as you are hiring new employees.
What does Workers Compensation Insurance Cover?
Workers compensation insurance covers you if your employees becomes ill or gets injured while at work. It pays for:
- Medical payments
- Death benefits
- Lost wages
If your employee injures themselves over the weekend while snowboarding, then you’re not responsible for that—they must be injured at work.
How does Workers Compensation Insurance Differ from General Liability Insurance?
Some people do get confused about this because they know that general liability insurance covers bodily injuries. That’s true, but general liability insurance only covers bodily injuries that happen to your clients or your customers. Employees who injure themselves are covered under workers compensation insurance. If you as a business owner personally get injured, general liability doesn’t cover that either. Workers compensation insurance would cover you, assuming you included yourself in the policy.
New York has expensive rates for workers compensation insurance, but you can’t skip it, as that will lead to fines and possible lawsuits. Shop around for the best rate, and make sure you emphasize safety at your job sites.