workers compensation insurance

Do I Need Workers’ Compensation Insurance if I Have No Employees?

If you are a sole proprietor with no employees, the answer to the question “do I need workers’ compensation insurance” can seem like a simple one. However, many factors contribute to whether a business should purchase workers’ compensation insurance, and even sole proprietors should consider them.

What Does Workers’ Compensation Insurance Cover?

Workers’ compensation insurance ensures employees experiencing job-related illness and injuries are able to obtain medical care. When an accident happens at work, workers’ compensation is a guarantee the employee will be reimbursed for medical bills, doctor visit fees, medications, and other medical costs. The employee is also able to receive coverage for lost wages due to missed work and may even qualify for extended payments due to temporary or permanent disability.

Coverage requirements vary by state. In most states, including South Carolina, companies with four or more employees must carry workers’ compensation insurance. Exceptions exist for industries such as the construction industry, agricultural employees, railroad workers, and employees with very low pay. In addition, most states consider unpaid volunteers separately. However, companies that fail to provide required workers’ compensation may be subject to fines and lawsuits.

Do I Need to Purchase Coverage?

Your state may not legally require sole proprietors to purchase workers’ compensation coverage for themselves, and will not penalize you for choosing not to purchase coverage. In addition, your state may not require coverage for seasonal employees or immediate family members. However, certain other situations for which you may desire to purchase coverage do exist. Consider whether these situations apply to your business.

  • You are an independent contractor. If you perform work for other businesses on a contract basis, such as a cleaning service, businesses could refuse to use your services unless you have your own workers’ compensation plan. If you injure yourself while on a contracted job at their property and are not covered by your own workers’ comp, the business who contracted you would need to cover you under their policy. Many businesses refuse to hire contractors without workers’ comp for this reason.
  • You occasionally employ others, including friends or family. If you take on occasional help for large jobs or over the summer, you will need to cover your temporary employee’s medical costs in the event they experience injury even if the state did not require you to purchase workers’ compensation coverage. If you have no workers’ compensation insurance, you will be personally responsible for the payment of medical bills.
  • You do not have the personal funds or private health insurance coverage to pay your medical bills or cover extended periods of disability. If you injure yourself on the job, do you have the savings or sufficient private health insurance to cover your medical bills and replace your lost wages? Could you replace your income if you became disabled and unable to work for a long period of time? If not, you may wish to purchase workers’ compensation insurance for yourself.
  • You hire contractors. If you hire contractors to work for you, you may be legally exempt from purchasing workers’ compensation insurance to cover them. However, similar to the above scenario in which you are the contractor, you may wind up paying for medical bills if a contractor has an accident on your site and does not have his or her own insurance. Your workers’ compensation insurance would protect you if you hire contractors without their own insurance.

Should I Purchase Coverage?

Dependent on your state’s laws, you may not need to purchase coverage. However, workers’ compensation insurance can be an important safety net in the event of a work-related accident. The primary source of workers’ compensation in South Carolina is the South Carolina State Accident Fund, but businesses may also purchase private insurance. It is important to consider state laws, the benefits of such coverage, and the unique risks of your line of work when deciding whether to purchase workers’ compensation insurance.

Talk to a Greenville Workers’ Compensation Lawyer

If you have been involved in a workplace accident that caused an injury, you need the help of a South Carolina workers comp lawyer that you can trust. The workers’ compensation attorneys at Fulton & Barr are ready to assist you with your case. They will fight for your worker’s comp claim and will get you the compensation you are owed. Let the Greenville workers compensation lawyers at Fulton & Barr help you today. Contact us now to set up a free consultation.