Learn how it can benefit both you and your employees to give them piece of mind against injuries or disabilities suffered in the workplace with workers' compensation insurance.
What is a Workers' Compensation Insurance policy?
Commonly known as Workers Comp, this is a policy which provides coverage against medical and rehab expenses incurred by employees who become injured while working, it also covers them against lost wages for the period they are unable to work. The policy also pays out death benefits to employees families should an employee lose their life while working. In return for Employers providing workers compensation insurance they are protected from civil suits being brought by employees who become injured while working.
California Workers' Compensation Policy Requirements
California law specifies that every policy must provide coverage for:
- Medical Care
- Permanent Disability Benefits
- Return to Work Supplement
- Temporary Disability Benefits
- Supplemental Job Displacement Benefits
- Death Benefits
Workers' Compensation policies are regulated by the California Division of Workers Compensation (DWC). Usually any claims against a workers comp policy can be agreed between the employer, employee and insurance company. However, if issues do arise the DWC provides an Information and Assistance Unit which will mediate the process if required.
Do you need to provide Workers Comp?
If you are a business owner here in Huntington Beach, Orange County, or in fact anywhere in the State of California then the simple answer is yes! In California Workers Compensation is mandatory for all businesses which have at least one employee, some high risk professions such as roofers are actually mandated that sole proprietors must take out a policy for themselves.
It is important to ensure that your staff are correctly clasified as either employees or independent contractors to ensure that you have the correct level of Workers Compensation cover.
For more information about workers' compensation please visit the Workers' Comp section of our Insurance 101 guides.
Frequently Asked Questions
How much does Workers' Compensation Insurance Cost?
The cost of a workers’ comp policy is different for every business. The workers' comp premium calculation is based on the payroll and determined risk of the business being insured.
Do I need Workers Compensation if my workers are 1099 contractors?
Assembly Bill 5 (AB 5) was effective in CA on January 1, 2020. A worker is considered an employee (and must be covered under Workers Compensation) and not an independent contractor, unless the hiring entity can demonstrate it meets ALL THREE of the following requirements:
- The individual is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact.
- The individual performs work that is outside the usual course of the hiring entity’s business.
- The individual is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed.
For more information please visit The California Labor Website.
Do I need workers comp for part-time employees?
California law presumes anyone who works for an employer is an employee so yes even part time staff require workers compensation coverage. You can get a waiver for independent contractors, however, if a contractor files a claim the business must prove they are not an employee or the business will be liable.
What happens if my business does not have workers compensation insurance?
Failure to provide Workers Compensation coverage is a criminal offence Penalties include business closure and or a $10,000 fine. Your business could be fined $100,000 If a worker is injured on the job and your business does not have Workers Compensation insurance.
Can an employee make a claim if it was their own fault they got hurt?
Yes. Workers’ compensation is “no-fault” which means that employees can make a claim even if they caused their own injuries. However, there are exceptions, for example, if an employee is intoxicated while on the job and is injured they may be ineligible for benefits.