In my state you are allowed as a company owner to be exempt from your policy and you pay the base amount to "have" a workers comp policy. This doesn't cover you but it allows your COI to show you have the policy which is all most companies want. All companies go thorough a vicious audit every year by their own insurance company, if they aren't self insured, and the sole purpose of this audit is to make more money for the blood sucking parasite insurance company. They tear through your records and if they find you had a contractor doing work for you that doesn't have a COI on file, they will charge somewhere in the neighborhood of 30% of work done by said contractor to "cover" the insurance company. So lets say Billy Bob did 100k worth of work for you last year but you failed to get a COI showing coverage well you just got a 30k bill handed to you. Same for your customer, its less of liability and more of feeding the vicious blood sucking parasite insurance companies.
I digress though, sorry.
Insurance companies have become wise to this and informed most building owners of this ploy to save money so most now have a rider written in that basically says no exempt employees. I know I sound bitter but *** (three letter insurance company) and the whole PMI mortgage insurance fraud that started this catastrophe in the housing market ticks me off to no end.
Also, you will most likely run into a customer that preys on unsuspecting contractors and will get you to do a large job and then refuse payment (or withhold 50%) due to insufficient insurance coverage and you will be in a mess, so you better get at least the certificate if your state offers that route. Even if you have the WC on yourself it really isn't worth much. If your smart you are taking as much off the books cash as you can from good customers you like and/or paying your self a small salary to have income to pay on for old uncle sucker to leave you alone and take your cut mostly off of your company dividends at a much lower rate. This will make WC useless for you.
Most small guys i see get the WC certificate to be covered and end up getting AFLAC to supplement their own private health insurance policies. JMHO.
Workmans Comp for a sole proprieter with no employees is really a joke but sometimes you need it to get the job. I pay around 750 a year for my policy which doesn't cover me but anyone I pay to do any work for me. I get audited every year & if I pay out more than the minimum I'm allowed to anyone without their own policy then I get charged more. All my subs have their own WC policy just like I do so its not a factor for me. The way I understand it is that the policy holder is responsible for themselves as the business owner but anyone they hire who does not have a policy is covered by their policy.
So I'm not covered by WC & my subs are not covered by WC but we all are paying for a WC policy. Only the insurance companies could figure out a way to get everyone paying while noone is covered.
Workman comp laws do not protect owners from lawsuits/liability if they show negligence
As a self employed individual I would talk to your insurance man and se if work mans comp, short term or long term disabilities air the right choice
I spent over 3 years in WC as an employee and I can tell you WC does protect an employer from lawsuits from on the job accidents
I started on the facilities management side for lager commercial. I would NOT bid any contactor in any trade who did not have work comp. Same goes for my house. While there is still the risk of a lawsuits from the proprieties stand point it reduce that risk due to the fact the contractor has some coverage.
Thats what you like to think Glen. But there are other reasons. But I'm not going to hijack his thread
Have you gotten so old that you forgot. It's political and this is the wrong forum
Pagey, I was not a subscriber, the Co I worked for was. Tort reform was voted in to protect business from lawsuits by injured workers
Glen, I'll start with one sentence. If the tread does not get moved I will continue.
When the GOP , which controls Texas' Senate , House and Governor decided to protect Business And Doctors. They passed WC laws that did just that.
My bad. 2 sentences