Four Reasons You May Not Be Covered By Workers' Compensation Insurance

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Four Reasons You May Not Be Covered By Workers' Compensation Insurance

18 April 2017
 Categories: Law, Blog

In the USA, most employees can count on being covered by workers' compensation insurance (or at least they're required to be covered, so if their employer doesn't cover them they can sue). However, there are quite a few exceptions to this general rule. It's important to know if you're getting yourself into a situation where you fall under an exception, so here are the basics of four main reasons why your employer wouldn't be required to take out workers' comp insurance for you.

1. Your employer runs a small business

Although workers' comp requirements vary by state, several states don't require a small business to get insurance until they've hired more than three, four, or five employees. There are also exceptions in some cases. For example, in some states, your employer also employs a maid who falls under the "domestic servant" category, the maid may not count towards the total number of employees.

2. You work at sea (or in another exempt industry)

Workers who work at sea have a different arrangement. Instead of being required to have workers comp coverage, there are different types of compensation they can receive when injured. So if you're thinking of working in this industry, your workers comp requirements may change. Other exemptions may vary by state; for example, in some states there are fewer requirements for workers comp coverage of agricultural employees.

3. Your employer is a family member

This is less frequent, but it's also possible that you live in a state such as Idaho, where hiring family members that live in your household means you don't have to pay workers' comp. So if you live in Idaho, still live with your family, and work for your dad or mom, you may not require coverage.

4. You live in Alabama

This just goes to show how much variation there is in the state-by-state requirements for workers' comp. Some states, such as Michigan and Minnesota, are proud of saying they allow no exemptions and everyone is required to be covered. But in other states, the requirements may be more lax; and in Alabama they apparently don't exist. Alabama will allow you to get workers' comp insurance, but won't require it and won't enforce it.

As you can see, workers' comp is a little more complicated than it seems at first. Before you take a job, it's always a good idea to check whether workers' compensation is one of the benefits that comes along with it; in more cases than you'd expect, it might not be. To learn more, visit resources like Rizzi Law Group.