The Ultimate Guide to Workers Compensation Insurance Requirements by State

One of the most important types of business insurance, workers compensation insurance is coverage that just about every business will need to buy. If one of your employees is injured on the job or experiences a work-related illness, workers compensation insurance will pay for the employee’s medical bills and a percentage of their weekly wage, among other things. In order to receive workers compensation benefits, your injured employees give up their right to file a claim against your business related to their injury. However, there are cases in which employees will give up these benefits and file a workers compensation claim if they believe that they can win the case. This usually occurs when employees believe that their injuries were the result of gross negligence or intentional harm on the part of their employers. If such a claim arises, employer’s liability coverage, which is usually built into the workers compensation policy, should cover the costs of the business’s legal defense.

Does Your Business Need Workers Compensation?

The answer to this question is almost always “yes.” Most employers are required by law to purchase workers compensation. In fact, every single U.S. state but Texas mandates that companies purchase workers compensation coverage. Even if you’re a sole proprietor or self-employed and don’t have any employees as a part of your business model, best practice is to check with the state in which your business operates to make sure that you are compliant. Some states will allow sole proprietors to opt out of coverage or self-insure. And while it's true that a vast majority of businesses must purchase this coverage, rules regarding how much you'll pay, which type of workers don't need coverage, and what the fines are for not having coverage vary considerably from state to state. As you continue reading this piece, you’ll notice that almost every question you ask related to workers compensation coverage, in order to be answered conclusively, needs to be further investigated on an individual basis by researching the specific regulations that your state mandates for workers compensation insurance.

How to Buy Workers Compensation Insurance

Essentially, there are three ways in which you can buy workers compensation insurance—three sources from which a policy can be purchased. Let’s take a look at what they are:

Private Insurance Carriers

Almost every state provides businesses with the option of working with private insurance carriers in order to buy workers compensation coverage. Many businesses prefer this route because it allows them to consolidate their insurance programs in one spot. Instead of buying workers compensation from a state fund and the rest of their policies from private insurance carriers, many prefer to buy all their business insurance policies from a singular source, so that they can manage all their policies and renewals more easily.

Competitive State Funds

Many states have their own funds that are set up to enable companies to purchase workers compensation directly from the state. If your business operates in a high-risk industry or it has a history of workers compensation claims, a state fund might be your best bet if private carriers are either turning you down or offering incredibly expensive premiums because of your specific situation and increased risk. It’s also important to note that not every competitive state fund is directly administered by the state. Some are private insurance carriers that are working with the state in order to provide coverage for riskier businesses that private carriers won’t insure on their own. Essentially, the state shares the insurable risk with the private carrier in order to provide coverage for higher-risk businesses. Some states, South Carolina and Alaska for example, offer an assigned risk pool for high-risk businesses that is administered by the National Council on Compensation Insurance (NCCI). Here’s a list of states that offer competitive state funds with links to the corresponding insurers:

Monopolistic State Funds

There are four states that do not allow businesses to purchase workers compensation coverage from private insurance carriers—North Dakota, Ohio, Washington, and Wyoming. These are known as monopolistic workers compensation states because businesses operating in these states can only buy their coverage from the state fund. This means that businesses in these states can’t shop around to find the best premiums for their coverage. It also means that businesses can’t purchase employer’s liability coverage along with their workers compensation either and must purchase additional coverage to cover that gap.

Providing Coverage for Out-of-State Employees

Again, this is a question that can’t be answered generally. Businesses that have employees working in other states should carefully research state requirements. In some states, you’ll have to buy additional coverage for out-of-state workers, in others you won’t. For example, if you have employees who are working in a monopolistic state but you’ve purchased your policy from a private carrier in your own state, you might have to purchase a separate policy for your distributed employees. Obviously, if your business is located in Texas where workers comp coverage is not mandated and you have remote workers in other states in which workers compensation is mandatory coverage, you are going to have to purchase coverage for your staff located outside of Texas at the very least.

Penalties for Noncompliance

Since purchasing workers compensation is mandated in every state but Texas, that means businesses that don’t operate in Texas and choose not to purchase this coverage can face significant fines and sanctions. As with almost everything else related to workers compensation, the severity of the penalties for noncompliance varies from state to state. However, there are several determining factors that will usually influence how much you are going to have to pay in fines for noncompliance, including: Why you’re not in compliance: If you’re purposely withholding or misrepresenting information such as the type of jobs your employees perform and the number of people you employ, there’s a good chance that you are going to be paying a lot more than if your noncompliance was in some way accidental or inadvertent. How long you haven’t been in compliance: Most states will have a rate that they will charge for each day that your business is noncompliant. Size of your staff: This once again depends from state to state and is not a rule of thumb, but the smaller your business is and the fewer employees you have, the lighter your fines for noncompliance will usually be. In any case and for whatever reason, workers compensation noncompliance can cost your business a lot of money and in more severe cases, someone from your management could be facing jail time.

A State-by-State Look at Workers Compensation Requirements

While there are obviously similarities from state to state related to rules and regulations regarding workers compensation coverage and how to purchase it, it’s important for every business to strictly follow the guidelines that their state provides. Every state sets its own requirements regarding which workers should be covered by workers compensation and which types of workers are exempt. To get the freshest and most accurate information, however, your best bet would be to contact your state’s official department of workers compensation, which the US Department of Labor's directory outlines. We've done our best to provide you with some of the most important workers comp requirements for businesses on a state-by-state basis at a quick glance. To get an idea of what your state's workers compensation insurance regulations look like, find your state on the map and click on it to view the general information we have compiled.

Alabama

Is Workers Compensation Mandated?

Yes. Every business in Alabama with five or more employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Domestic servants
• Farm laborers
• Casual employees
• Those working for a business with fewer than five people
• Licensed real estate brokers
• Product demonstrators

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from the Alabama Assigned Risk Pool if they are a high-risk company and cannot buy the policy from a private carrier. Alabama employers can also self-insure, meaning they can pay their own workers compensation claims instead of submitting them to an insurance company. To qualify for self-insurance, the business must have a net worth of at least $5 million, positive income over the last three years, and an assets/liabilities ratio of one or greater.

Penalties for Noncompliance

Businesses could be fined $1,000 per employee for each day they fail to provide coverage. Criminal penalties could result in jail time as well. They can also be ordered to close the business until they come into compliance.

Death Benefits

Eligible family members can receive death benefits amounting to no more than 75% of the deceased employee’s average weekly wages, which can’t exceed the average weekly wage across the state. They can receive benefits for no longer than 500 weeks. Eligible family members can also receive a lump-sum payment for funeral expenses, as long as the worker died no longer than four years from the date of the injury.

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Alaska

Is Workers Compensation Mandated?

Yes. Every business in Alaska with one or more employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Part-time babysitters
• Domestic servants
• Harvest and similar non-permanent help
• Contracted entertainers
• Statutorily-defined taxi cab drivers
• Statutorily-defined commercial fishermen
• Non-commercial cleaning employees
• Sports officials working amateur events
• Entertainers working under contract
• Professional hockey team players and coaches with health insurance
• Real estate agents working under contract
• Transportation company drivers

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from competitive state funds if they are a high-risk company and cannot buy the policy from a private carrier.

Penalties for Noncompliance

Businesses could be fined $1,000 per employee for each day they fail to provide coverage. Criminal penalties could result in fines of $10,000 and one year of jail time. They can also be ordered to close the business until they come into compliance, can be barred from pursuing job contracts in-state, and held liable to pay all benefits for injured employees who should have been covered by insurance.

Death Benefits

Eligible family members can receive weekly death benefits that must equal the deceased employee’s compensation rate for total disability. Eligible family members can also receive a lump-sum payment of $10,000 for funeral expenses and $5,000 for the employee’s surviving spouse and/or children.

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Arizona

Is Workers Compensation Mandated?

Yes. Every business in Arizona with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Casual employees
• Domestic servants
• Independent contractors

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from a competitive state fund if they are a high-risk company and cannot buy the policy from a private carrier.

Penalties for Noncompliance

Workers compensation insurance in Arizona is regulated by the Industrial Commission of Arizona (ICA), who can penalize businesses that do not comply. Businesses that do not have the right insurance can face penalties from $1,000 up to $10,000. If a business does not have workers compensation insurance and is sued by an injured worker, the ICA will pay the benefits and then charge the business for reimbursement along with a penalty of either 10% of the benefits paid or $1,000, whichever is greater.

Death Benefits

Eligible family members can receive benefits that equal 67% of the deceased employee’s average monthly wage. Eligible family members can also receive a lump-sum payment of $5,000 for funeral expenses.

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Arkansas

Is Workers Compensation Mandated?

Yes. Every business in Arkansas with at least three employees must obtain coverage. If you are in a high-risk industry, such as construction, then your business will have to carry workers compensation even if you have less than three employees.

Types of Workers Potentially Excluded from Coverage

• Agricultural farm laborers
• Real estate agents
• Religious, charitable, non-profit organizations
• State employees
• Casual employees
• Inmates

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

Businesses that fail to purchase workers compensation will pay fines to the state and will lose the protection provided by the  Arkansas Workers Compensation Commission.

Death Benefits

Eligible family members can receive benefits that equal 67% of the deceased employee’s average weekly wage.

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California

Is Workers Compensation Mandated?

Yes. Every business in California with one or more employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Domestic employees employed by family members
• Deputy sheriffs or clerks
• Anyone performing services in return for aid or sustenance only
• Anyone officiating amateur sporting events
•  Volunteers at non-profit recreational camps

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from competitive state funds if they are a high-risk company and cannot buy the policy from a private carrier.

Penalties for Noncompliance

Failure to carry workers compensation is a criminal offense and your business will be ordered to stop working if your employees are not insured. If your business violates the stop order, it can be fined $10,000 or more. This violation can also lead to a year of jail time. Penalties assessed by the Division of Labor Standards Enforcement in California could cost your business double what it would have cost to pay your workers compensation premiums or $1,500 per employee. If you do not have workers comp and one of your employees is injured on the job, your business could face a penalty of $10,000 per employee if the case is compensable and $2,000 if the case was found to be non-compensable, with a maximum penalty of $100,000.

Death Benefits

Eligible family members can receive death benefits. One dependent can receive up to $250,000, two or more up to $290,000, three or more up to $320,000 in eight annual installments. Eligible family members can also receive a lump-sum payment for funeral expenses of up to $10,000.

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Colorado

Is Workers Compensation Mandated?

Yes. Every business in Colorado with one or more employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Commission-based real estate agents and brokers
• Independent contractors performing for-hire transportation services
• Providers of residential host-home services or support
• Railroad employees not covered under federal law
• Independent contractors
• Inmates
• Volunteers
• Drivers under a lease agreement with a common carrier

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from competitive state funds if they are a high-risk company and cannot buy the policy from a private carrier.

Penalties for Noncompliance

If it is determined that your business does not carry the proper workers compensation insurance, the Division of Workers Compensation can issue a cease and desist order, requiring your business to stop all operations until the proper insurance policy has been procured. Fines can go up to $250 for every day without workers compensation and if there are multiple violations, up to $500 per day.

Death Benefits

Eligible family members can receive death benefits equal to 67% of the deceased worker’s average weekly wages. Spouses receive benefits for life or until they remarry and children would receive benefits until the age of 18. Eligible family members can also receive a lump-sum payment of $7,000 for funeral expenses.

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Connecticut

Is Workers Compensation Mandated?

Yes. Every business in Connecticut with one or more employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Sole proprietors
• Business partners
• Independent contractors
• Part-time employees (26 hours per week or less)

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

If your company does not carry the proper workers compensation insurance, the Connecticut Workers Compensation Commission will issue a stop-work order until your insurance is paid and will impose a $300 per worker per day fine.

Death Benefits

Eligible family members can receive death benefits. The amount is based on a portion of the average weekly earnings of the deceased, according to a complicated formula that provides for yearly cost-of-living increases. Eligible family members can also receive a lump-sum payment of $4,000 for funeral expenses.

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Delaware

Is Workers Compensation Mandated?

Yes. Every business in Delaware with one or more employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• A spouse and minor children of a farm employer not named in an endorsement to the farm employer’s contract of insurance
• Sole proprietors
• Low-earning agricultural and domestic workers
• Real estate sales professionals
• Government employees
• Independent contractors
• Part-time employees (26 hours per week or less)

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

If you fail to provide workers compensation insurance, you may be fined three times the amount equal to the insurance premium you should have paid for one year.

Death Benefits

Eligible family members can receive death benefits. If the deceased worker provided for 100% of a family’s income, then the weekly death benefit would be 100% of the worker’s weekly pay. Death benefits are available for a minimum of five years and a maximum of 12 years. Eligible family members can also receive a lump-sum payment of $7,000 for funeral expenses.

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District of Columbia (Washington D.C.)

Is Workers Compensation Mandated?

Yes. Every business in Washington D.C. with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Employees whose employer is an uninsured subcontractor can assert a claim against the general contractor

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

If you fail to provide workers compensation insurance, your business could be fined between $1,000 and $10,000. Business leaders can also be held personally liable for injuries occurring while the business was not properly insured. Continuous violations of the workers comp laws could result in misdemeanor charges, fines, or imprisonment for up to one year.

Death Benefits

Eligible family members can receive death benefits if the employee dies of a work-related injury within one year of the incident occurring or within five years of disability stemming from the injury. The deceased’s family can receive  50% of the worker’s average weekly wage if there are no children and an additional 17% for each child up to a maximum of 67% of the deceased workers wages. Eligible family members can also receive a lump-sum payment of up to $5,000 for funeral expenses.

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Florida

Is Workers Compensation Mandated?

Yes. Every business in Florida with four or more employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Independent contractors (all but construction workers)
• Licensed real estate brokers
• Musicians and theatrical performers
• Part-time employees
• Volunteers (most)
• Some vehicle-for-hire drivers
• Some sports officials

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

If you fail to provide workers compensation insurance, your business will be subject to a stop-work order that requires all operations to stop until compliance and all penalties are paid. The penalty fee is typically two times the amount the business would have to have paid in premium for the last two years.

Death Benefits

Eligible family members can receive death benefits if the employee dies of a work-related injury within one year of the incident occurring or within five years of disability stemming from the injury. The deceased’s family can receive up to $150,000 in compensation benefits paid at up to 66.67% of the deceased’s weekly wage. Eligible family members can also receive a lump-sum payment of up to $7,500 for funeral expenses.

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Georgia

Is Workers Compensation Mandated?

Yes. Every business in Georgia with three or more employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Railroad workers engaged in interstate or intrastate commerce
• Farm laborers
• Domestic servants
• Licensed real estate agents or associate brokers
• Independent contractors

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

Both criminal and civil penalties could apply to businesses in Georgia that do not carry workers compensation insurance. If an employee is injured and the business does not provide workers comp, the employer will have to compensate the injured worker by covering all of the expenses that workers compensation insurance would have covered, including legal fees, civil penalties, all medical expenses, and a 10% in compensation. Civil penalties range between $100 and $1,000 per violation for those who violate workers compensation regulations. Failure to provide coverage can cost between $500 and $5,000 per violation. Employers who willfully do not option insurance for their employees can be found guilty of a misdemeanor, punishable by a fine of between $1,000 and 10,000 or up to a year in jail time.

Death Benefits

Eligible family members can receive death benefits totaling up to $150,000 and are paid until age 65 or after 400 weeks of payments, whichever yields the larger amount. Eligible family members can also receive a lump-sum payment of up to $7,500 for funeral expenses.

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Hawaii

Is Workers Compensation Mandated?

Yes. Every business in Hawaii with employees must obtain coverage, no matter whether the employees are full-time or part-time workers.

Types of Workers Potentially Excluded from Coverage

• Voluntary or unpaid nonprofit organization workers
• Students working in exchange for room, board, or tuition
• Authorized ministers, priests, or rabbis
• Domestic workers
• Real estate salespersons and brokers

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

Businesses in Hawaii that fail to carry workers compensation insurance can face fines of up to $100 per employee per day and leave themselves open to employee lawsuits related to workplace injuries.

Death Benefits

Eligible family members can receive death benefits up to 67% of the injured worker’s average weekly wages and are eligible to receive compensation for funeral expenses.

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Idaho

Is Workers Compensation Mandated?

Yes. Every business in Idaho with one or more employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Domestic workers
• Pilots flying in agriculture
• Real estate brokers and real estate salesmen
• Volunteer ski patrollers
• Officials secondary school sports events
• Employees covered under federal workers compensation
• Outworkers

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from competitive state funds if they are a high-risk company and cannot buy the policy from a private carrier.

Penalties for Noncompliance

Businesses that do not obtain the proper coverage can be held liable for employee injuries and all of the benefits that would have been provided by workers compensation insurance. They can also face an additional 10% penalty for medical coverage, wage loss benefits, and the injured worker’s legal fees. Businesses also face fines of either $2 per employee per day or $25 per day, whichever is greater, for the entire period of noncompliance. Criminal misdemeanor penalties are possible as well.

Death Benefits

Eligible family members can receive death benefits for up to 500 weeks. Spouses receive benefits until they remarry and up to three dependent children can receive benefits until the age of 18. If the death occurred within four years of the injury, some funeral expenses can be covered as well.

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Illinois

Is Workers Compensation Mandated?

Yes. Every business in Illinois with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Real estate brokers
• Farmers
• Jurors

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

Businesses can be fined $500 per day for every day of noncompliance. If failure to carry insurance is found to be negligent, it is considered a misdemeanor in Illinois and a felony if knowing and willful. A felony conviction can lead to up to three years of jail time and fines of up to $25,000.

Death Benefits

Eligible family members can receive death benefits up to a total of $500,000 or 25 years. Eligible family members can receive a lump-sum payment for funeral expenses of $8,000.

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Indiana

Is Workers Compensation Mandated?

Yes. Every business in Indiana with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Railroad workers
• Employees of fire or police departments
• Casual laborers
• Farm or agricultural employees
• Household employees
• Seamen, Longshoremen with access to federal alternatives
• Real estate employees
• Independent contractors
• Athletes on scholarship
• Prison inmates
• Reserve police officers
• Volunteers
• Youth sports team coaches

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from the Indiana Assigned Risk Pool if they are a high-risk company and cannot buy the policy from a private carrier. Indiana employers can also self-insure, meaning they can pay their own workers compensation claims instead of submitting them to an insurance company.

Penalties for Noncompliance

Uninsured businesses can face civil and criminal liability in Indiana. Civil penalties can cost uninsured employers up to $50 per day per employee and can be issued a stop-work order until compliance and all penalties have been paid. Since failure to insure is a crime in Indiana, employers who willfully do not obtain coverage can be charged with a misdemeanor and face up to one year or prison time and a fine of up to $5,000.

Death Benefits

Eligible family members can receive death benefits equalling two-thirds of the worker’s average weekly wage paid for up to 500 weeks. Eligible family members can receive a lump-sum payment for funeral expenses of $7,500.

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Iowa

Is Workers Compensation Mandated?

Yes. Every business in Iowa with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Household employees earning less than $1,500 during 12 months before an injury
• Casual employees earning less than $1,500 during 12 months before an injury
• Agricultural employees where the employer’s nonexempt cash payroll is less than $2,500 for the preceding calendar year
• Relatives of farm employer and employer’s spouse
• Some corporate officers

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from the Iowa Assigned Risk Pool if they are a high-risk company and cannot buy the policy from a private carrier. Iowa employers can also self-insure, meaning they can pay their own workers compensation claims instead of submitting them to an insurance company.

Penalties for Noncompliance

Businesses that fail to maintain workers comp insurance or to pay required benefits their self-insurance account can face civil penalties of up to $1,000, awards to the injured employee of up to 50% of additional benefits for denying weekly benefits, and the revocation of self-insurance privileges.

Death Benefits

Eligible family members can receive death benefits equalling 80% of the deceased worker’s average weekly after-tax pay. Eligible family members can receive a lump-sum payment for funeral expenses worth up to 12 times the average weekly pay of the deceased worker.

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Kansas

Is Workers Compensation Mandated?

Yes. Every business in Kansas with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Businesses with a payroll of $20,000 or less
• Some agricultural workers
• Realtors working as independent contractors
• Firefighters belonging to a relief association that has waived coverage
• Owner-operator vehicle drivers (e.g., freight truckers) who have their own occupational accident insurance

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from the Kansas Assigned Risk Pool if they are a high-risk company and cannot buy the policy from a private carrier. Kansas employers can also self-insure, meaning they can pay their own workers compensation claims instead of submitting them to an insurance company.

Penalties for Noncompliance

Businesses that do not maintain workers compensation insurance can face civil penalties of twice their workers compensation premium or $25,000, whichever is greater. The state can also shut down any business that fails to provide coverage.

Death Benefits

Eligible family members can receive weekly death benefits based on 67% of the deceased worker’s average weekly wage. Total benefits may not exceed $300,000 unless the benefits are going to a child under the age of 18. The initial payment made by the state will be $40,000. The state will pay funeral expenses up to $5,000 and all medical bills related to the fatal accident.

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Kentucky

Is Workers Compensation Mandated?

Yes. Every business in Kentucky with one or more employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Domestic servants, if there are less than two regularly employed in a private home for 40 hours or less per week
• Maintenance, repair and similar employees employed in a private home
• Agricultural businesses
• Railroad, maritime workers covered under federal workers compensation programs
• Certain religious organizations

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from the state’s assigned risk residual market if they are a high-risk company and cannot buy the policy from a private carrier. Kentucky employers can also self-insure, meaning they can pay their own workers compensation claims instead of submitting them to an insurance company.

Penalties for Noncompliance

Businesses operating without workers compensation insurance can be fined $1,000 per employee, per day in which the business fails to provide mandated coverage. The business can also be shut down until it comes into compliance. Willfully failing to comply can lead to criminal penalties and jail time.

Death Benefits

Eligible family members can receive weekly death benefits of up to 75% of the deceased worker’s average weekly wage, for no longer than 500 weeks. The state will pay a lump-sum for funeral expenses calculated based on Kentucky’s average weekly wage, as long as the worker died no more than four years after the date of the injury.

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Louisiana

Is Workers Compensation Mandated?

Yes. Every business in Louisiana with at least one employee must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Household employees and workers of private unincorporated farms
• Musicians and performers
• Real estate salespeople
• Nonprofit volunteers
• Some public officials

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from competitive state funds if they are a high-risk company and cannot buy the policy from a private carrier.

Penalties for Noncompliance

Businesses operating without workers compensation insurance can be fined up to $250 per employee for the initial violation and $500 per employee for every next violation, up to $10,000 total. Employers can also face criminal penalties and jail time if they are found to be in willful violation of workers compensation laws and regulations. A work-stop order can also be issued for all businesses that fail to carry workers compensation insurance until the proper coverage is secured.

Death Benefits

A surviving spouse or surviving child individually can receive 32.5% of the deceased worker’s average weekly wage. A spouse and child can receive 46.25%. A dependent sibling can receive 32.5%, with 11% for each additional sibling up to 65%. If there are no dependents, adult children will receive $75,000 to split among them. Eligible family members can also receive a lump-sum payment of $8,500 for funeral expenses.

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Maine

Is Workers Compensation Mandated?

Yes. Every business in Maine with at least one employee must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Independent contractors
• Maritime employees covered under admiralty law
• Seasonal or casual Agriculture or aquaculture workers
• Domestic workers

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from competitive state funds if they are a high-risk company and cannot buy the policy from a private carrier.

Penalties for Noncompliance

Businesses without workers compensation insurance may be liable for medical and death benefits. They can also be charged with a Class D crime, penalized up to $10,000 or 108% of the premium they would have paid for the insurance, whichever is greater. They can also lose their business licenses and/or corporate charter.

Death Benefits

Eligible family members can get weekly death benefits amounting to two-thirds of the deceased employee’s average weekly wages, which can’t exceed the state’s average weekly wage, and can receive benefits for no longer than 500 weeks. Eligible family members can receive a lump-sum of $4,000 for funeral expenses along with incidental expenses of $3,000 to the deceased worker’s estate.

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Maryland

Is Workers Compensation Mandated?

Yes. Every business in Maryland with at least one employee must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Some agricultural employees
• Independent contractors

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from competitive state funds if they are a high-risk company and cannot buy the policy from a private carrier.

Penalties for Noncompliance

A business that fails to maintain the workers comp insurance will be fined up to $10,000 and the officers of the company would be liable for the cost. It is also a misdemeanor in Maryland to deduct workers compensation costs from worker wages.

Death Benefits

Eligible family members can receive two-thirds of the deceased worker’s average weekly wage as death benefits. If the deceased provided 70% of the household income, dependents would receive 70% of two-thirds of their average weekly wage. Death benefits are available for a maximum of 12 years. Eligible family members can receive a lump-sum of $7,000 for funeral expenses.

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Massachusetts

Is Workers Compensation Mandated?

Yes. Every business in Massachusetts with at least one employee must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Workers on vessels engaged in interstate or foreign commerce
• Those working in organized, professional athletics
• Real estate brokers
• Independent contractors
• Commission only salespeople
• Persons employed by an employer engaged in interstate or international commerce
• Casual workers

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

If a business does not carry workers compensation insurance, the state can issue a stop-work order and the business can face fines of $100 per day, weekends, and holidays included until they procure insurance and pay the fine. If the business appeals the state's stop-work order, they can remain open, but the fine then increases to $250 per day.

Death Benefits

Eligible family members will receive death benefits calculated on the basis of the deceased worker's pre-injury weekly pay, equaling 66% of the deceased worker’s average weekly wage, but not exceeding the state average weekly wage. Funeral and burial costs will also be covered.

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Michigan

Is Workers Compensation Mandated?

Yes. Every business in Michigan with three or more employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Smaller employers
• Some agricultural employees and domestic workers
• Real estate brokers

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

If a business does not have the correct workers compensation coverage, the state file a court order to prohibit the company from hiring new employees until the right coverage is secured. The business can be fined $1,000 or face jail time, in between 30 days and six months.  Employees can also take legal action in civil court against the business.

Death Benefits

Eligible family members can receive a combined 80% of the deceased worker’s average weekly wage for up to 500 weeks. If the beneficiary is a minor, then they can receive benefits until the age of 21. Eligible family members can receive a lump-sum of $6,000 for funeral expenses.

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Minnesota

Is Workers Compensation Mandated?

Yes. Every business in Minnesota with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Farmers
• Domestic workers
• Casual workers

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from a competitive state fund if they are a high-risk company and cannot buy the policy from a private carrier.

Penalties for Noncompliance

If a business fails to meet workers comp requirements, the state can prohibit the company from hiring until the proper coverage is secured. Businesses can also be ordered to pay fines of up to $1,000 per employee, per week. If an employee suffers an injury at a time during which insurance was not provided, the business could be ordered to pay back all workers compensation benefits to the state with an added penalty equaling 65% of the benefits.

Death Benefits

Eligible family members can receive benefits equal to no more than 67% of the deceased employee’s average weekly wage. Funeral and burial costs will also be covered.

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Mississippi

Is Workers Compensation Mandated?

Yes. Every business in Mississippi with at least five employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Independent contractors
• Domestic workers
• Farm laborers
• Employees of nonprofit organizations
• Federal workers
• Transportation and maritime employees covered by federal insurance

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

Businesses that fail to provide workers comp insurance can be fined up to $1,000 and face up to a year of jail time. Employers could also be forced to pay benefits for injured employees themselves.

Death Benefits

Eligible family members can receive benefits based on a certain percentage of a deceased worker’s average weekly wage. These benefits will be paid at least every 14 days, for as long as 450 weeks after the death. Surviving spouses can also receive a lump-sum of $1,000. Eligible family members can receive a lump-sum of $5,000 for funeral expenses.

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Missouri

Is Workers Compensation Mandated?

Yes. Every business in Missouri with at least five employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Leased truck operators in interstate commerce
• Farmworkers
• Domestic servants
• Family chauffeurs
• Licensed real estate agents
• Inmates
• Volunteers
• Sports officials

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from a competitive state fund if they are a high-risk company and cannot buy the policy from a private carrier.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance can be charged with a misdemeanor and can face a penalty of three times the insurance premium that should have been paid, up to $50,000, if found guilty. The business would also be responsible for paying for the medical expenses of injured employees. If it is discovered that the business does not have coverage a second time, they could be charged with a felony.

Death Benefits

Eligible family members can receive benefits that will not be more than 67% of the deceased employee’s average weekly wage. Benefits will continue until the surviving spouse dies or gets remarried. If the spouse remarries, they will get a final lump-sum payment equal to two years of benefit payments. Funeral and burial costs will also be covered.

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Montana

Is Workers Compensation Mandated?

A majority of businesses in Montana must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Domestic servants
• Casual workers
• Dependent member of the employer’s family
• Sole proprietors
• Real estate brokers
• Certain officials at athletic events
• Freelance photographers and authors
• Newspaper carriers
• Cosmetologist or barbers
• Jockeys
• Ordained ministers
• Officer or manager of a ditch company
• Persons working for enrolled tribal members who operate solely within the boundaries reservations
• Petroleum land workers

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from competitive state funds if they are a high-risk company and cannot buy the policy from a private carrier.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance could be forced to pay double the amount of what they would have paid in premium. The minimum such penalty is $200.

Death Benefits

Eligible family members can receive benefits based on a percentage of the deceased worker's average weekly wage, and not exceeding 66.67% of the worker's average weekly wage. Eligible family members can receive a lump-sum of $4,000 for funeral expenses.

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Nebraska

Is Workers Compensation Mandated?

A majority of businesses in Nebraska must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Domestic servants
• Agricultural employees
• Railroad workers employed by companies engaged in interstate or foreign commerce
• Federal employees
• Most volunteers

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance could face a civil fine of up to $1,000 for each violation. Each day of noncompliance is treated as its own violation. A company’s right to do business in the state could also be revoked and company leaders could face jail time of up to a year. If an injured employee sues for damages in district court, the business will lose its common law defenses for the trial as well.

Death Benefits

Eligible family members can receive benefits equal to two-thirds of the worker’s former pay. Eligible family members can receive a lump-sum of $6,000 for funeral expenses.

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Nevada

Is Workers Compensation Mandated?

Yes. Every business in Nevada with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Casual employees
• Theatrical or stager performers
• Musicians whose services do not last more than two consecutive days
• Domestic workers
• Voluntary ski patrol
• Sports officials paid a nominal fee
• Any member of the clergy
• Real estate brokers
• Direct salespersons working on commission

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance could be charged a fine up to $15,000 in addition to premium penalties. They could also face a stop-work order until insurance is obtained. The business would also be financially liable for any injuries that happen during the period when their employees are uninsured. The business owner could be held criminally responsible if a work-related injury results in substantial bodily harm or death.

Death Benefits

Eligible family members can receive benefits equal to 66% of the worker’s average monthly wage. Eligible family members can receive a lump-sum of $10,000 for funeral expenses.

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New Hampshire

Is Workers Compensation Mandated?

Yes. Every business in New Hampshire with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Railroad workers engaged in interstate commerce
• Direct sellers
• Real estate brokers and appraisers
• Service providers for individuals with developmental, acquired, or emotional disabilities

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance may be liable for a one-time fine of $2,500 and a fine of $100 per employee, per day without coverage. The state may also suspend the company from conducting business in New Hampshire until compliant.

Death Benefits

Eligible family members can receive weekly compensation. Eligible family members can receive a lump-sum of $10,000 for funeral expenses.

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New Jersey

Is Workers Compensation Mandated?

Yes. Every business in New Jersey with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Independent contractors
• Domestic workers
• A willfully negligent employee
• Inmates
• Casual workers

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance can face financial penalties up to $5,000 for the first 20 days of noncompliance and up to $5,000 for each 10-day period thereafter. The penalties are delivered in the form of liens against the business, prosecuted through seizure of property.

Death Benefits

Eligible family members can receive death benefits to cover approved medical bills and one dependent will receive 50% of the deceased employee’s wages. The amount increases by 5% for every additional dependent up to a maximum of 70%. These benefits will be paid for up to 450 weeks. Eligible family members can receive a lump-sum of $3,500 for funeral expenses.

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New Mexico

Is Workers Compensation Mandated?

Yes. Every business in New Mexico with three employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Independent contractors
• Domestic workers
• A willfully negligent employee
• Inmates
• Casual workers

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from the New Mexico Assigned Risk Pool if they are a high-risk company and cannot buy the policy from a private carrier. New Mexico employers can also self-insure, meaning they can pay their own workers compensation claims instead of submitting them to an insurance company.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance can be shut down until they obtain the proper coverage.

Death Benefits

Eligible family members can receive death benefits of a maximum of the amount that the deceased worker would have received in disability income benefits for 700 weeks. Funeral and burial costs will also be covered.

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New York

Is Workers Compensation Mandated?

Yes. Every business in New York with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Domestic employees working less than 40 hours per week
• Clergymen
• Employees of municipalities not engaged in hazardous employment
• Sanitation workers, firefighters and police officers in the employment of the City of New York
• Babysitters and minors over the age of 14 engaged in casual employment
• Longshoremen and harbor workers
• Railroad employees

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from competitive state funds if they are a high-risk company and cannot buy the policy from a private carrier.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance for five or fewer employees within a one-year period can and can face fines of between $1,000 and $5,000. If the business doesn’t provide coverage for more than five employees, it becomes a felony and fines increase to $5,000-$50,000. If the employee is convicted of failing to secure coverage twice in the span of five years, the fine would be between $10,000 and $50,000 and could include other penalties.

Death Benefits

Eligible family members can receive death benefits of up to 66.67% of the deceased worker’s average weekly wage. If there are children, 36.6% goes to the spouse and 30% is split between all children. Children stop receiving benefits at 18 or 23 if they are full-time students. Eligible family members can receive a lump-sum of $6,000 for funeral expenses.

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North Carolina

Is Workers Compensation Mandated?

Yes. Every business in North Carolina with three or more employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Casual workers
• Independent contractors
• Anyone engaged in an illegal enterprise
• Real estate broker and agents
• Board members
• Newspaper deliveries
• Railroad workers covered under federal policies
• Domestic employees
• Farm laborers
• Commission-based sellers of agricultural products

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance can face fines of one dollar per employee per day, with a $50 per day minimum and a $100 per day maximum, regardless of the number of employees. Willful violations could result in felony charges, while neglectful violations will be considered misdemeanors. The business could also be held liable for the compensation owed to an injured worker and could face criminal charges. The business would also be responsible for medical treatment costs and wage loss benefits in the event of an injury. There would also be no payment of defense costs by insurance if the employee was to sue the business.

Death Benefits

Eligible family members can receive death benefits of up to two-thirds of the deceased worker’s average weekly wage, payable for a minimum of 500 weeks. Eligible family members can receive a lump-sum of $10,000 for funeral expenses.

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North Dakota

Is Workers Compensation Mandated?

A majority of businesses in North Dakota must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Owner, partner, corporate officer or spouse
• Employer’s children under the age of 22
• Certain licensed real estate brokers
• Newspaper delivery personnel
• Farm and ranch labor
• Certain custom farm operations
• Household domestic workers
• Employees engaged in the operation of a place of worship
• Federal and railroad employees

Purchasing a Policy

North Dakota uses a monopolistic state fund, meaning that there is no private insurance marketplace in the state. All employers, no matter how risky the industry, are guaranteed coverage under the state insurance program.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance will be liable to pay the premium for all employees during the uninsured period. They can also be held liable for the cost of all claims that arise during the uninsured period and can be sued by employees who are injured while uninsured. The state can also issue a stop-work order for non-compliant businesses and will require businesses to pay a one-time $10,000 penalty and an added $100 for every next day of noncompliance.

Death Benefits

Eligible family members can receive death benefits equaling two-thirds of the deceased worker's weekly wage, up to 110% of the state's average weekly wage. Eligible family members can receive a lump-sum of $10,000 for funeral expenses.

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Ohio

Is Workers Compensation Mandated?

Yes. Every business in Ohio with three or more employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Domestic workers
• Volunteers

Purchasing a Policy

Ohio uses a monopolistic state fund, meaning that there is no private insurance marketplace in the state. All employers, no matter how risky the industry, are guaranteed coverage under the state insurance program.

Penalties for Noncompliance

The state sets a premium and sends every business a payment schedule. If a business allows coverage to lapse by not making a payment on time results in a fine of 1% of the premium due. Failure to pay the premium results in a $30 fee and a charge of up to 15% of the premium due, depending on how late the payment is received.

Death Benefits

Eligible family members can receive death benefits of up to 66.67% of the deceased worker’s average weekly wage. If a dependent spouse was to remarry, he or she would receive two year’s worth of benefits in a single lump-sum. Eligible family members can receive a lump-sum of $5,500 for funeral expenses.

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Oklahoma

Is Workers Compensation Mandated?

Yes. Every business in Oklahoma with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Horticulture workers not using motorized machines
• Licensed real estate brokers
• Medical care or social services employees
• Employers with less than five employees if they are all related by blood or marriage
• Youth league employees if they are tax exempt
• Sole proprietors
• Volunteers
• Domestic servants
• Leased truck and tractor-trailer operators

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from the Oklahoma Assigned Risk Pool if they are a high-risk company and cannot buy the policy from a private carrier. Oklahoma employers can also self-insure, meaning they can pay their own workers compensation claims instead of submitting them to an insurance company.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance can face a $1,000 fine for each day their employees are uninsured. They can also be held liable for injured worker lawsuits and open to civil litigation. The state can also issue a work-stop order that lasts until the business purchases coverage and pays all its penalties.

Death Benefits

Eligible family members can receive death benefits. The state determines payments according to a predefined schedule, with a combination of lump-sum payments, ongoing weekly benefits, and funeral expenses.

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Oregon

Is Workers Compensation Mandated?

Yes. Every business in Oregon with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Inmates or wards of a state institution
• Casual employees

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from competitive state funds if they are a high-risk company and cannot buy the policy from a private carrier.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance can incur a penalty of twice the amount of the premium that should have been paid, with a minimum fine of $1,000. If the business remains non-compliant, additional penalties of $250 per day, without a limit, would ensue. Failing to provide coverage for an extended period could lead to jail time.

Death Benefits

Eligible family members can receive death benefits of up to 66% of the deceased worker’s average weekly wage at the time of the injury multiplied by 4.35 each month. Each child can receive 25% of the worker’s average weekly wage multiplied by 4.35. Eligible family members can receive a lump-sum of $19,000 for funeral expenses.

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Pennsylvania

Is Workers Compensation Mandated?

Yes. Every business in Pennsylvania with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Casual employees

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from competitive state funds if they are a high-risk company and cannot buy the policy from a private carrier.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance can face civil and criminal penalties. If a business fails to provide coverage, the employer can be found guilty of a misdemeanor, could face jail time, and would be fined up to $2,500. If the violation was found to be intentional, the fine can be up to $15,000 and the employer could face up to seven years in prison. If an employee is injured while the business is uninsured, the state fund will pay benefits, which the employer will later have to repay including interest, penalties, and various fees. Businesses can also be sued by injured employees if workers compensation insurance was not provided.

Death Benefits

Eligible family members can receive death benefits in the form of weekly payments based on a percentage of what the deceased would have received for total disability. Eligible family members can receive a lump-sum of $3,000 for funeral expenses.

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Rhode Island

Is Workers Compensation Mandated?

Yes. Every business in Rhode Island with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Employees of the state
• Casual employees
• Farmers and farm laborers
• Nursery workers
• Real estate brokers
• Salespeople
• Sole proprietors and partners
• Domestic service employees

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from competitive state funds if they are a high-risk company and cannot buy the policy from a private carrier.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance can face a $250 fine and an additional fine of $1,000 for each noncompliant day. Employers can also face a felony charge, which can lead to a potential two-year prison sentence and $10,000 fine. The state can also shut down your business until coverage is acquired.

Death Benefits

Eligible family members can receive death benefits in the form of weekly payments. The amount will depend on the deceased worker’s marital status and the number of dependents, but cannot exceed the state’s weekly disability benefit. Eligible family members can receive a lump-sum of up to $20,000 for funeral expenses.

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South Carolina

Is Workers Compensation Mandated?

Yes. Every business in South Carolina with four or more employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Casual employees

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance can be mandated by the state to cover all claim costs if one of their uninsured employees is injured on the job.

Death Benefits

Eligible family members can receive death benefits equalling two-thirds of the deceased employee’s average weekly salary for 500 weeks from the date of the injury. Eligible family members can receive a lump-sum of $2,500 for funeral expenses.

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South Dakota

Is Workers Compensation Mandated?

Yes. Every business in South Dakota with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Volunteers
• Independent contractors
• Domestic servants working less than 20 hours per week
• Farm laborers
• Certain elected government officials
• Workfare participants

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance may open themselves to legal action from injured employees. Injured employees can sue uninsured businesses for all applicable medical expenses incurred due to the incident, plus twice the amount of disability income or death benefits allowed under state law.

Death Benefits

Eligible family members can receive death benefits equalling 67% of the employee's average weekly wage. If the dependent spouse remarries, the state will pay a lump-sum equaling two years of the worker’s pay. Dependent children who are disabled will receive payments for their entire lives. Children can also receive an additional $50 per month until they turn 18 and an added $2,000 per year for up to five years if they are enrolled in an accredited college in South Dakota as a full-time student. Eligible family members can receive a lump-sum of up to $10,000 for funeral expenses.

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Tennessee

Is Workers Compensation Mandated?

Yes. Every business in Tennessee with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Undocumented workers

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers. The state does not offer a state insurance fund, but high-risk businesses that can’t find insurance through a private carrier can receive coverage from the NCCI, which administers Tennessee's Workers Compensation Insurance Plan.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance could pay  $10,000 or more for failure to comply in a timely manner with a specialist’s or administrator’s designee’s order. They may also face a 25% penalty to an injured worker for not paying the state’s mandated temporary disability benefits.

Death Benefits

Eligible family members can receive death benefits. If there is only a surviving spouse, they can receive 50% of the deceased worker’s average weekly pay. If there is a surviving spouse and child, they are eligible to receive  66.67% of the average weekly wage. If the deceased employee had no dependents, the insurer will pay $20,000 to the person’s estate. Eligible family members can receive a lump-sum of $10,000 for funeral expenses.

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Texas

Is Workers Compensation Mandated?

No. Texas is the only state in which workers compensation insurance is optional. Only businesses that contract with government entities are required to buy coverage.

Types of Businesses Required to Have Coverage

• Any public employer
• State universities
• Building and construction contractors for public employers
• Motorbus companies
• Motor carriers
• Liquid propane gas and compressed natural gas dealers
• Employers of inmates in work furlough programs

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from competitive state funds if they are a high-risk company and cannot buy the policy from a private carrier.

Penalties for Noncompliance

There are no penalties for not having workers comp insurance for private companies. Businesses must provide a safe workplace and to take all reasonable steps to protect their employees. If the business does purchase insurance but does not comply with its requirements, there are administrative penalties that can be issued.

Death Benefits

Eligible family members can receive death benefits equaling 75% of the deceased employee's average weekly wage split among the beneficiaries. Eligible family members can receive a lump-sum of up to $10,000 for funeral expenses.

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Utah

Is Workers Compensation Mandated?

Yes. Every business in Utah with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Real estate agents and brokers
• Some farmworkers
• Casual workers
• Domestic workers

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from the state fund if they are a high-risk company and cannot buy the policy from a private carrier. Utah employers can also self-insure, meaning they can pay their own workers compensation claims instead of submitting them to an insurance company.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance could face a penalty of at least $1,000, a legal injunction against doing business in the state, and the loss of the protection from getting sued for injury benefits that insurance provides.

Death Benefits

Eligible family members can receive death benefits totaling 66.67% of the deceased employee’s average weekly wage. Funeral expenses will be paid as well.

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Vermont

Is Workers Compensation Mandated?

Yes. Every business in Vermont with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Casual employees
• Amateur athletes
• Agricultural employees for an employer with an aggregate payroll of less than $10,000 per year
• Family members living in the employer’s house
• Those engaged in service about a private dwelling
• Sole proprietors
• Real estate brokers or salespeople
• Certain members of a corporation or LLC Independent contractors
• Assistant judges

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from the Vermont Assigned Risk Pool if they are a high-risk company and cannot buy the policy from a private carrier. Businesses can also self-insure, meaning they can pay their own workers compensation claims instead of submitting them to an insurance company.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance could pay a civil penalty of $100 for each day without coverage, up to a maximum of $5,000. The state can also shut down the business until the proper coverage is secured.

Death Benefits

Eligible family members can receive death benefits of in between 67% and 77% of the deceased worker’s prior weekly pay. Eligible family members can receive a lump-sum of $15,000 for transportation and funeral expenses.

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Virginia

Is Workers Compensation Mandated?

Yes. Every business in Virginia with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Employees who are not employed within the usual course of the employer’s business

Purchasing a Policy

Business owners can buy workers compensation insurance from private carriers and can purchase from the Virginia Assigned Risk Pool if they are a high-risk company and cannot buy the policy from a private carrier. Businesses can also self-insure, meaning they can pay their own workers compensation claims instead of submitting them to an insurance company.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance could pay a civil penalty of $250 for each day without insurance, up to a maximum of $50,000.

Death Benefits

Eligible family members can receive death benefits to cover all medical, surgical, and hospital services and supplies. Funeral expenses of no more than $10,000 and transportation expenses of no more than $1,000 will also be available to eligible family members.

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Washington

Is Workers Compensation Mandated?

Yes. Every business in Washington with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Workers for businesses registered within the Registration of Contractors
• Licensed electricians
• Domestic servants
• Home gardening and maintenance workers
• Workers performing services in return for aid or sustenance
• Sole proprietors or partners
• Minors employed by parents in agriculture
• Jockeys
• Corporate officers
• Entertainers
• Newspaper deliveries

Purchasing a Policy

Washington uses a monopolistic state fund, meaning that there is no private insurance marketplace in the state. All employers, no matter how risky the industry, are guaranteed coverage under the state insurance program.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance could pay a civil penalty of $250 for each day without insurance, up to a maximum of $50,000.

Death Benefits

Eligible family members can receive death benefits; a one-time payment of the average state monthly wage, along with a monthly pension that’s based on the deceased worker’s average monthly wage. Eligible family members can also receive a lump-sum payment of up to $10,000 for funeral expenses.

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West Virginia

Is Workers Compensation Mandated?

Yes. Every business in West Virginia with three or more employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Domestic servants
• Agricultural employers of fewer than six full-time employees
• Church workers
• Casual employees
• Employees engaged in organized, professional sports activities
• Volunteer rescue or police
• Federal employees
• Longshore and harbor workers

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance can be fined $500 or more on the first offense and up to $25,000 for subsequent offenses. A stop-work order could be issued as well. If the business does not pay workers compensation contributions, there will be a late penalty of 10% of the computed tax, plus interest - a fee of between $50 and $500.

Death Benefits

Eligible family members can receive death benefits equaling two-thirds of the deceased worker’s average weekly earnings at the time of the injury. Eligible family members can also receive a lump-sum payment of up to $7,000 for funeral expenses.

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Wisconsin

Is Workers Compensation Mandated?

Yes. Every business in Wisconsin with three or more employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Domestic workers
• Most volunteers
• Some farmworkers
• Employees of Native American tribal enterprises
• Most real estate brokers, agents, and salespersons
• Some federal workers

Purchasing a Policy

Business owners can buy workers compensation insurance from private insurance carriers.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance can face a penalty equal to twice the insurance premiums the business should have been paying or $750, whichever is greater. The business can also be closed by the state until coverage is secured and the employer would also be personally liable for costs related to injuries that occurred while the business was uninsured.

Death Benefits

Eligible family members can receive weekly death benefits. Eligible family members can also receive a lump-sum payment of up to $10,000 for funeral expenses.

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Wyoming

Is Workers Compensation Mandated?

Yes. Every business in Wisconsin with employees must obtain coverage.

Types of Workers Potentially Excluded from Coverage

• Casual employees
• Sole proprietors
• Corporate officers
• Independent contractors
• Professional athletes
• Federal government employees
• Elected officials
• Volunteers Members of LLCs
• Foster parents
• State childcare workers

Purchasing a Policy

Wyoming uses a monopolistic state fund, meaning that there is no private insurance marketplace in the state. All employers, no matter how risky the industry, are guaranteed coverage under the state insurance program.

Penalties for Noncompliance

Businesses that fail to carry the proper workers compensation insurance can face fines, jail time, stop-work orders, and can be sued by injured employees.

Death Benefits

Eligible family members can receive death benefits equaling a minimum of 80% of the state’s average monthly wage and maximum of twice the state’s average monthly wage, depending on what the worker was making before the injury or illness. Eligible family members can also receive a lump-sum payment of up to $10,000 for various funeral expenses.