Workers’ Compensation insurance fixes a lot of difficult problems. Without Workers’ Comp, the relationship between workers and their employers can become contentious when someone is injured on the job. A single employee-injury lawsuit can cause entire businesses to close their doors, putting people out of work. At the same time, if an injured worker doesn’t sue, they may be stuck with financially crippling medical bills.
Workers’ Comp insurance puts everyone at the business on the same side when injuries happen, because the insurance company takes care of the costs, and litigation is rarely necessary. However, if your business does dangerous work, insurance companies are probably going to have difficulty writing a policy for it. It’s simply too risky.
In order to provide insurance for businesses that are a high claims risk, Workers' Comp State Funds were created. These funds are state-created Workers’ Comp insurance carriers. Because they deal solely in Workers’ Comp, and are non-profits, State Funds provide a competitively priced “catch-all” for businesses that struggle to find necessary coverage elsewhere.
Does my state have a workers' comp state fund?
Maybe. Not every state in the US has a workers' comp state fund, but nearly every state requires businesses to carry Workers’ Compensation insurance. If you’ve been unable to acquire Workers’ Comp, or if you think your business is a good fit for a state fund option, you should find the contact information for your state fund on the AASCIF website. They have a helpful map of the US with links and contact info for each available state fund.
What do I do if my state doesn’t have a fund?
There are usually many resources available to small businesses to find an insurance provider that will cover them. Even in states without state funds, organizations like the WCRIBMA in Massachusetts provide tools for finding a suitable Workers’ Comp insurance carrier for your business. On the other hand, a national insurance brokerage like AP Intego will do all the heavy lifting for you when it comes to finding the right insurance carrier, and determining whether you qualify for Pay As You Go workers' comp.