You need to buy a workers compensation policy if you plan to hire one or more employees when you start a business. This type of policy replaces all or part of a worker's wages lost and accompanying medical expenses incurred because of a job-related injury.
Workers compensation insurance laws and codes differ from state to state so you need to check with a qualified insurance agent or your lawyer for the rules in force in your area.In most areas, you have a legal obligation to carry workers compensation insurance.
You do not have a legal obligation to purchase most or all of the other insurance types discussed in this section. Workers comp, as it is often called, is not a substitute for health insurance because it only covers work-related injuries. If you fail to carry this coverage, you are subject to severe penalties. If you do not have this coverage and a worker is injured, you are subject to criminal penalties that can land you in jail.
As mentioned, all 50 states have different requirements for workers compensation insurance, so you need to check on the requirements in your area. Some states set the rates and operate a state administered fund of workers compensation insurance. These states include North Dakota, Ohio, Washington and Wyoming.
Other states allow private insurers to provide workers compensation insurance subject to criteria developed by the states. These states include: California, Delaware, District of Columbia, Indiana, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Carolina and Wisconsin.
Some states allow private insurers but the systems are managed and rated by the National Council on Compensation Insurance (NCCI). These include: Alabama, Alaska, Arkansas, Arizona, Colorado, Connecticut, Florida, Georgia, Hawaii, Idaho, Illinois, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Mexico, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Utah, Vermont, Virginia and West Virginia.
Texas allows businesses to operate without workers compensation insurance.
When you start a business, here are other types of business insurance to discuss with a qualified professional: accidental death and dismemberment, advertisers personal injury, bodily injury liability, business continuation coverage/buy-sell planning, business interruption insurance, business owners policy (BOP) , commercial automobile insurance, comprehensive general liability (CGL) , crime coverage, cyber coverage, directors and officers, disability insurance, employment practice liability, fiduciary bond, fiduciary liability, fire legal liability, group life insurance, group retiree health benefits, group travel insurance, key person insurance, medical payments, product and completed operations exposures, professional liability (errors and omissions) coverage, property damage liability, property insurance (repair and replacement), umbrella liability.
Here are links to state workers compensation insurance rules:
Alabama (AL), Workers Comp: Alabama workers comp info
Alaska (AK), Workers Comp: Alaska workers comp info
Arizona (AZ), Workers Comp: Arizona workers comp info
Arkansas (AR), Workers' Comp: Arkansas workers comp info
California (CA), Workers Comp: California workers comp info
Colorado (CO), Workers Comp: Colorado workers comp info
Connecticut (CT), Workers Comp: Connecticut workers comp info
Delaware (DE), Workers Comp: Delaware workers comp info
District of Columbia (DC), Workers Comp: District of Columbia workers comp info
Florida (FL), Workers Comp: Florida workers comp info
Georgia (GA), Workers Comp: Georgia workers comp info
Hawaii (HA), Workers Comp: Hawaii state workers comp info
Idaho (ID), Workers Comp: Idaho workers comp info
Illinois (IL), Workers Comp: Illinois state workers comp info
Indiana (IN), Workers Comp: Indiana workers comp info
Iowa (IA), Workers Comp: Iowa workers comp info
Kansas (KS), Workers Comp: Kansas workers comp info
Kentucky (KY), Workers Comp: Kentucky workers comp info
Louisiana (LA), Workers Comp: Louisiana state workers comp info
Maine (ME), Workers Comp: Maine state workers comp info
Maryland (MD), Workers Comp: Maryland state workers comp info
Massachusetts (MA), Workers Comp: Maryland workers comp info
Michigan (MI), Workers Comp: Michigan workers comp info
Minnesota (MN), Workers Comp: Minnesota workers comp info
Mississippi (MS), Workers Comp: Mississippi workers comp info
Missouri (MO), Workers Comp: Missouri workers comp info
Montana (MT) Workers Comp: Montana workers comp info
Nebraska (NE), Workers Comp: Nebraska workers comp info
Nevada (NV), Workers Comp: Nevada workers comp info
New Hampshire (NH), Workers Comp: New Hampshire workers comp info
New Jersey (NJ), Workers Comp: New Jersey workers comp info
New Mexico (NM), Workers Comp: New Mexico workers comp info
New York (NY), Workers Comp: New York workers comp info
North Carolina (NC), Workers Comp: North Carolina workers comp info
North Dakota (ND), Workers Comp: North Dakota workers comp info
Ohio (OH), Workers Comp: Ohio workers comp info
Oklahoma (OK), Workers Comp: Oklahoma workers comp info
Oregon, Workers Comp: Oregon workers comp info
Pennsylvania, Workers Comp: Pennsylvania workers comp info
Rhode Island, Workers Comp: Rhode Island workers comp info
South Carolina, Workers Comp:South Carolina workers comp info
South Dakota, Workers Comp: South Dakota workers comp info
Tennessee, Workers Comp: Tennessee workers comp info
Texas, Workers Comp: Texas workers comp info
Utah, State of Workers Comp: Utah workers comp info
Vermont, State Workers Comp: Vermont workers comp info
Virginia, Workers Comp: Virginia workers comp info
Washington, Workers Comp: Washington workers comp info
West Virginia, Workers Comp: West Virginia workers comp info
Wisconsin, Workers Comp: Wisconsin workers comp info
Wyoming, Workers Comp: Wyoming workers comp info
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