Starting a new business is exciting. Hiring your first employee is a milestone. But that milestone also comes with a legal obligation in most states: workers comp insurance. Here is what new business owners need to know before they bring anyone on.
When Do You Need Workers Comp?
In most East Coast states, you need workers comp coverage before your first employee starts work, not after. New York, New Jersey, Connecticut, and most other states have no grace period. The day you have an employee is the day you need to be covered.
How to Get Coverage as a New Business
New businesses without a claims history are assigned a standard rate based on their industry class code. Without an experience modifier to apply, you pay the industry base rate. This is actually an opportunity because a new business with no claims history has a clean slate to build a favorable modifier over time.
What Information Do You Need to Apply?
To get a workers comp policy as a new business you will need your business entity information, a description of the work your employees will perform, an estimated annual payroll, and the number of employees you plan to hire. An independent agent can walk you through the process quickly.
Can You Cover Yourself as an Owner?
In most states, business owners have the option to include or exclude themselves from coverage. If you do physical work alongside your employees, including yourself is worth considering. An injury that sidelines you means lost income with no replacement unless you have coverage.
Get Coverage Before Day One
Comp Matters Inc. helps new businesses get workers comp coverage quickly. Call (631) 248-2500 and we can often have a policy in place within 24 hours.
Recent Comments