California employers are required by law to have workers’ compensation insurance, even if you have only one employee.
This is true even if that employee is a family member!
If your employees get hurt or sick because of work, you are required to pay for workers’ compensation benefits.
The benefits include:
- Medical care
- Temporary disability benefits
- Permanent disability benefits
- Supplemental job displacement benefits
- Vocational rehabilitation
- Death benefits
Below are four important items to consider as you begin to evaluate your options:
- Begin shopping for coverage before you hire your first employee. By law, coverage must be in place upon hire.
- Keep detailed payroll records. The premium for workers’ compensation insurance is based on actual payroll paid, and is auditable.
- Be sure your employees are being classified correctly for workers’ compensation rating purposes. The main rating factor of the premium you pay for workers’ compensation insurance is related to the industry classification(s) assigned to your business. It is important that a correct classification code is assigned to each employee. If an incorrect classification is used, the error will likely be caught at the time of the annual audit and can result in unexpected premium due. A knowledgeable broker can assist with this classification for you.
- Is your insurance broker large enough to have access to multiple insurance carriers, yet small enough to offer personal service?
- Do you have an advocate to work with in the case of a claim?
- Is your broker able to assist with workers’ compensation related compliance tasks such as legal hand-outs, posters and/or enrolling in an MPN (Medical Provider Network)?
- Can they offer risk management services, including assessments, classroom safety trainings, and setting up an Injury, Illness and Prevention Program (IIPP)?