As a small business owner or manager, you’ve made it because you’re an expert in your industry. And if you’re like most, the pressing demands of your business haven’t required you to become an expert in workers’ comp insurance for small business.
That’s where Axcet HR Solutions comes in. We serve as experts in all things HR—including workers’ comp—so you can focus on running your core business. In this article, we’ll break down some of the most common misconceptions surrounding workers’ comp liability, coverage, and solutions. We’ll also show you where to turn if you can use a hand finding coverage, comparing coverage options, or revamping your safety programming to lower your premium costs.
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If my state doesn’t require our business to have workers’ comp insurance, it’s because we don’t need it.
Out of the fifty U.S. states, Texas is the only state that doesn’t require businesses to purchase workers’ comp insurance. Other states may have particular regulations that excuse certain businesses from carrying workers’ comp insurance. However, as a practical matter, almost all businesses are required to have workers’ compensation coverage.
For example, in Missouri, businesses with fewer than five employees aren’t required to carry coverage unless they operate in the construction industry. And in Kansas, workers’ comp insurance is only mandatory for employers who maintain a gross payroll of over $20,000 or operate in the agricultural industry.
Be careful with these “exceptions” to regulations—they may not be as straightforward as you think. Part-time, temporary, and seasonal workers may count toward the five-employee coverage requirement in Missouri.
Even if the rules of your state don’t mandate that you purchase workers' comp insurance for small business, it's still (almost always) the right move to procure coverage. Otherwise, your business may be taking on the liability associated with workplace injuries sustained by your employees.
Additionally, if you have any intent to grow your business, it’s a good idea to have workers’ comp insurance in place before expanding your business.
I only have a few employees, so I don't need workers’ comp. Insurance.
It's a common misconception that small businesses with only a few employees don't need workers' comp insurance. However, this myth can lead to significant risks and liabilities. Here’s why:
Many states mandate workers' comp insurance even for small businesses. For example, as previously mentioned, Missouri requires businesses with five or more employees to have coverage, and Kansas mandates it for employers with a gross payroll over $20,000.
But even if your state doesn't require it, having workers' comp insurance is a smart move.
Regardless of your business size, workers' comp insurance is a critical safety net that protects both your employees and your business.
RELATED: Workers' Compensation Laws in Kansas and Missouri >>
Workers’ compensation insurance is expensive and employers have no control over workers' compensation costs.
Workers’ comp insurance premiums vary based on many factors, including your industry, the size of your business and your claims history. For example: a workers’ compensation policy for an auto repair shop will cost more than a policy for an accounting firm because injury exposure is greater at an auto repair shop vs. an accounting firm.
Beyond your industry, the biggest impact on workers’ compensation costs is your claim history. Employers may be able to lower their premiums through a demonstrated commitment to injury prevention and safety compliance. Your commitment to safety can be evidenced by;
If you know you need to ramp up your workplace safety but don’t know where to start, you’re not alone. Axcet HR Solutions’ workplace safety and risk management experts are always available to help.
The health insurance we provide our employees will cover them if they get hurt.
Unfortunately, almost all health insurance policies will not cover medical costs for the treatment of work-related injuries. The idea that health insurance will simply “pick up the bill” is a dangerous (but common) misconception.
This alone is a key reason why obtaining workers’ comp insurance is critical to the health and livelihoods of your employees. Because workers’ comp coverage is not fault-based, coverage extends to employees who are injured on the job even if the injury was “their fault.”
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When it comes to workers’ compensation insurance for small business, we have no idea what we’re doing or how to be prepared for a claim.
With Axcet HR Solutions, you’ll always have a team of expert risk management consultants who specialize in workers' comp on your side. The experienced consultants at Axcet can recommend the best coverage for your workplace and guide you through the process from end to end.
Along with our experienced workplace safety consultants, insurance experts, and more, Axcet has a dedicated, in-house workers’ comp claims management team ready to serve you. To find out more about how we can help, schedule a consultation with us today.