Workers Compensation Insurance

Minnesota Workers’ Compensation Insurance

What is workers’ compensation insurance?

Minnesota workers’ compensation insurance is essentially a combination of health insurance and disability policies, with some additional rules. It provides wage replacement and medical coverage to employees who are injured or become ill during their employment. It’s an exchange for the benefits, the employee gives up the right to sue the employer.

How much does work comp cost in Minnesota?

It depends on what you do. There are classifications for each type of work. The riskier the kind of work, the higher the rate. A roofer would pay a much higher rate than a plumber, and a carpenter would pay a higher rate than an electrician or salesperson, for example.

The coverage is then rated on the payroll. There is a minimum payroll for ghost or waiver types of policies in Minnesota (no payroll), but most companies will have employees. The higher the payroll, the higher the rate.

Other factors may include the duration of continuous workers’ compensation insurance coverage and having one to three full-time employees. Also, your claims experience can be a positive or negative factor.

Is workers’ compensation insurance a requirement in Minnesota?

It depends on who you are asking. If you are asking the State of Minnesota and you have employees, then absolutely yes. If you don’t have employees, then the answer is no.

Now let’s talk about general contractors. In Minnesota, general contractors are held accountable under Minnesota State Statute 176.215. An employer in Minnesota is generally responsible for providing workers ‘ compensation for its employees. The statute is an exception to the rule. Suppose a general contractor’s subcontractor fails to provide workers’ compensation insurance for its employees. In that case, the general contractor is liable for the workers’ comp benefits due to the injured employee or the uninsured subcontractor. This is huge, and why ghost or waiver policies are written for contractors without employees (zero payroll). It serves as a safety net for general contractors, but not entirely.

I don’t need workers’ compensation insurance, because I don’t have employees.  According to the state, you are correct. But it depends on who is asking.  If the company you are working for requires it, then you will most likely need to purchase a policy and provide a certificate of insurance.

What can I do to keep my workers’ compensation costs down in Minnesota?

There are several things that can keep your rates under control. Continuous coverage and no claims for a starter. The State of Minnesota requires that employers have workers’ compensation insurance if they have employees. Putting a gap or lapse in that coverage does not help your rates. Neither does switching carriers each year. Worker compensation companies are innovative and not in it to lose money.

We occasionally encounter misclassifications. Being rated wrong can certainly hurt you. It’s essential to be with an agent who is sharp and knows what they’re doing. We are and do! ☺

A proper risk management program and return-to-work program are also key to keeping claims and costs down.

Please request a quote online or contact us by phone.

Tell us about your Minnesota business and its workers’ compensation insurance needs; we’re listening. We will put together a customized insurance plan so you only pay for what you need.  Do yourself a favor and call 952-222-8073 right now or use the quick quote form on this page. Request your Minnesota work comp insurance quote now! You will be happy you did.

P.S. If you haven’t gotten a quote on your general liability insurance or commercial auto insurance, click these links or ask when you call.  If you’re looking for personal auto and home insurance, please visit Insuring Minnesota.