Workers’ Compensation for Employers
In addition to the Frequently Asked Questions (FAQs) below, employers can call 1-800-736-7401 during normal business hours to speak with a live representative of the Division’s Information Service Center Workers’ Compensation (DWC).
Employers can call a local Division of Workers’ Compensation (DWC) office and speak to the Information & Assistance (I&A) Unit for help during regular business hours.
DWC ‘s fact sheets and guides for injured workers can be helpful to employers and can be accessed at www.dwc.ca.gov .
Topics covered in these FAQs include:
Illegally uninsured employers
Q. Do I need to have workers’ compensation insurance?
A. Yes, California law requires employers to carry workers’ compensation insurance even if they only have one employee. If you are a roofer and do not have any employees, you are still required to have workers’ compensation insurance..
Out-of-state employers may need workers’ compensation coverage if an employee is regularly employed in California or the employment contract was entered into here.
Q. My husband/wife and I are the sole owners of our business. We don’t have employees. Are we required to obtain workers’ compensation coverage?
A. Generally, coverage for individual owners is optional. You do, however, need to have workers’ compensation coverage for any employee you may hire, even if it is just an employee, and even if it is only temporary employment. You should consult with your attorney, insurance agent or broker, or insurance company regarding the details of your situation and your options.
Q. Are the executive officers or directors of the company covered by workers’ compensation insurance?
A. Generally all employees of the business, as legally defined, including officers and directors of the business, must be included in the policy unless they are the sole owners of the business. In the case of individual owners, they can choose not to be covered. Several articles of the California Labor Code must be considered in answering this question. You should consult with your attorney, insurance agent or broker, or your insurance company regarding the details of your situation.
Q: How can I find out who has workers’ compensation coverage for another business in California?
A: California requires all employers to either purchase a workers’ compensation insurance policy from an insurance company licensed to write policies in California or to be self-insured. The Division of Workers ‘ Compensation (DWC) does not provide workers’ compensation insurance for employers and does not maintain information about employers and their respective insurers. To find out which insurer provides workers’ compensation insurance coverage for a specific employer, contact the Office of Workers’ Compensation Insurance Classification(Workers’ Compensation Insurance Rating Bureau- WCIRB). The list of self-insured employers can be found on the Office of Self-Insurance Plans website .
Basic information for employers about workers’ compensation can be found in the DWC ‘s fact sheet for employers .
Q. Where do I get workers’ compensation insurance?
A. You may purchase workers’ compensation insurance coverage through an agent or broker of any private insurance company licensed to write policies in California. You can find a list of insurers on the California Department of Insurance website..
If you cannot find an insurance company willing to cover your business, the State Compensation Insurance Fund (State Fund) is obligated to provide you with coverage.
If you belong to a trade association you might want to check with it first – some trade groups negotiate special membership rates. Your local chamber of commerce can also be a source of good advice.
Q. How about self-insurance?
A. Self-insurance requires state approval, a net worth of at least $5 million, net income of $500,000 per year, and putting up a security deposit. While historically only very large companies can self-insure due to legal requirements, in recent years, group self-insurance, in which multiple small-business employers in the same homogeneous industry pool workers’ compensation obligations , has increased in popularity as an alternative to traditional coverage. Contact your broker or the State Office of Self-Insurance Plans for information on how to self-insure.
A self-insured employer has the option of managing their own workers’ compensation claims or hiring a Third-Party Administrator (TPA) to provide these services.
Q. How much does workers’ compensation insurance cost?
A. The state does not regulate insurance premiums. While the Office of Workers’ Compensation Insurance Classification– the state insurance commissioner’s licensed statistical agent – recommends premiums and insurance companies must file their premiums with the California Department of Insurance, premiums may vary from insurer to insurer. Like any good consumer, you should shop around to see which insurance company best meets your needs. Cost is a consideration, but there are other factors to consider: services provided, ease of access to claims adjusters, familiarity with your industry, doctors in your network, etc. If you have a broker or agent, he or she should be able to give you expert advice.
Q. What determines how much I will pay for my premiums?
A. Several factors go into determining the annual premium your insurance company will charge you. These include your industry classification, your company’s work injury history (known as your history mod or ex-mod), your payroll, special underwriting adjustments such as using a certified health care organization, and any special pool or dividend programs for which you may be eligible.
About my employees:
Q. Can my employees help pay for workers’ compensation insurance?
A. No. Workers’ compensation insurance is part of your cost of doing business. An employer cannot ask its employees to help pay the insurance premium.
Q. What are my ad placement obligations?
A. You must post the “notice to employees” sign in a conspicuous place in the workplace. This poster provides information to employees about workers’ compensation insurance coverage and where to get medical care for work injuries.