As the year comes to a close, you probably have a few essential items to check on and follow up. Your budget for 2019, business plan changes and even your current inventory are all important items to keep track of at the end of the year.

There's one more thing you should add to your list, your Colorado workers' compensation insurance. While your current workers' comp policy might not line up with the calendar year, it's still something you should get on your to-do list to check.


Well, there are a few reasons. One is that any changes to your payroll can affect your premiums for the upcoming year, so you'll want to make sure you are budgeting correctly going into the new year.

A second important reason is that you must be sure your class codes line up with job functions. If someone's job role has changed that could have an impact on your workers' comp premium as well.

If this sort of review sounds daunting, don't worry it's not. There are easy steps you can take to double check everything is good to go on your end. And we're going to show you how to do it.

Documents to Review

First things first, you need to gather up all of the necessary documents related to your employees and payroll.

Payroll Records

These will include your payroll records for your coverage period. So gather individual earnings records, Unemployment Insurance Tax Reports (UITR) and your federal tax returns (forms 941 or 943, whichever you submit). Also, be sure to include separate documents for any overtime payments.

Employee Records

These will cover basic information about your employees. Make sure you include not only the number of employees you have but also their job description and classification code. Finally, also have a record the total hours they work annually.

Subcontractor Records

Don't forget about subcontractors or contract workers. Colorado workers' compensation law requires you have this insurance for independent contractors who work in-state. Gather your proof of payment to these workers, plus the relevant documentation that shows they are independent contractors. This should also include any cash disbursements you've paid to them during the time period too.

Learn more about the difference between employees and independent contractors here.

Non-Payroll Payment Records

Sometimes, employees will get payments outside of payroll. For example, you might have employees who travel for business submit expense reports. These are usually paid via check or bank transfer. You will need to have a record of these payments as well.

Certificate of Insurance

Once you've gathered all of the necessary payroll and employment documents, next check your certificate of insurance. Double check the date and the type of policy. As required by law in Colorado, workers' compensation insurance must cover subcontractors too.

Some Helpful Tips

Here are a couple of things to keep in mind as you perform your review:

  • Create a system for gathering the right information, using a project management tool can help keep you in check.
  • Set aside time to do this as the year ends or before your policy comes to a close, so you don't have to rush the process.
  • Always double check employee classification codes, especially for those employees who might have multiple classifications based on their job functions.

As your policy comes to a close, your insurance company will require an audit or annual review. So, having all of this information at the ready is going to ensure you're not going to run into any surprises. Gathering your documents now will make the audit process a breeze.

With Cake, gathering all the documents you need and updating your coverage is easy. In a few clicks, you can check your policy information and get your certificate of insurance, making your self-audit a breeze.

If you'd like to ensure your business complies with Colorado workers' comp insurance requirements, get in touch today. We can give you a quote in just five minutes.