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Workman’s comp insurance protects a person from potential liabilities when a worker is injured or dies while performing work. Typically, coverage is based on factors related to the specific job completed.
Workman’s comp insurance
Depending on your status as an independent contractor, not be aware of your state’s workers’ compensation requirements. You can learn everything you ought to know about your rate in a few minutes.
In almost all states, having workers’ compensation insurance is required by law. It helps protect independent contractors from lawsuits when injured on the job. A worker who suffers an injury while working for an employer is eligible for compensation, including lost wages and medical costs.
The insurance cost depends on your state, the number of employees, and whether you hire others to work for you. Obtaining a quote will let you determine whether you require coverage.
In New York, the law states that all employers must carry workers’ compensation insurance. However, you can do so if you have at most four employees.
An independent contractor does not count as an employee for this reason. But, if you have more than two employees, you must purchase insurance.
Protects you from liability
If you work as a freelancer, you must take the time to determine your insurance needs. Workers’ compensation is one type of insurance that can protect you from liability.
Whether you are working in construction, consulting, or some other field, it is imperative that you know what your insurance responsibilities are. Getting injured on the job can have devastating consequences. Your business may be forced to pay medical expenses or lose income for an extended time.
For organizations with more than two employees, workers comp for independent contractors is mandated by law in most states. However, some business owners choose to opt-out of coverage. Regardless, workers’ compensation protects you and your business from the legal and financial costs of employee injuries and lawsuits.
There are certain exemptions from this requirement, including sole proprietors, partners, domestic servants, and seasonal laborers in agriculture/aquaculture. You can also purchase an insurance policy for yourself.
Even if you are an independent contractor, you are still liable for injury or property damage if you are not covered. Ideally, it would be best if you collaborated with a knowledgeable agent to help you find a coverage solution that suits your needs.
Coverage is based on factors related to the work performed
If you run a small company and are interested in hiring an independent contractor for your next big project, you’ll want to make sure that you get the insurance plan that is right for you. Even if you need more money to purchase insurance for each independent contractor, there are ways to find the right coverage for your business.
Consulting with an insurance professional is the most effective technique to ensure you get the proper coverage. Learning a little about your state’s laws and regulations is also a good idea.
Unlike employees, independent contractors aren’t guaranteed a paycheck, so they have to take the time to ensure they aren’t on the hook for costly medical bills after an accident. Fortunately, many states require that an independent contractor’s company carry workers’ compensation coverage. It will help them avoid liability and relieve your company from handling costly claims.
It’s not required by law
You’ll likely need workers’ compensation coverage if you are a freelancer. However, not all independent contractors are required to carry this type of insurance. The rules vary by state, and it is crucial to know the requirements.
The Small Business Administration provides detailed information on the rules and regulations of workers’ compensation. It also explains how to determine who is an employee and who is an independent contractor. You can also consult with human resources professionals for more information.
If you are an employer, consider purchasing workers’ compensation insurance for your independent contractors. You can limit liability and provide medical benefits to injured workers. Even if you don’t, your employees can still sue you.
Workers’ compensation coverage is mandatory in most states, though there are exceptions. Some workers, including farm laborers, domestic servants, and partners, are excluded from the requirement. For example, an employee in agriculture/aquaculture is exempt, but the employer must still carry $25,000 in liability insurance.
You may also like: 4 Factors That Determine Your Workers’ Comp Rates
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