If you own a business and have employees, even if it’s only one person, you need Workers’ Compensation insurance.

Every employer, regardless of how many employees you have, is required by Colorado law to carry Workers’ Compensation insurance.

And the penalty for not having Workers’ Compensation  coverage is steep. The Colorado Division of Workers Compensation can fine businesses $250 for every day the business did not have Workers’ Comp insurance. Subsequent fines can reach $500 a day and can lead to an order to stop business operations.

Employers who have no Workers’ Compensation insurance must pay all medical and disability benefits of an injured employee plus an additional 50 percent for being uninsured.

Business owners aren’t required to provide workers’ compensation insurance for independent contractors if they truly are independent contractors. But many workers are misclassified as independent contractors when they should be classified as employees. In the event of an accident, the employer may have to prove the employee’s independent contractor status based on very stringent requirements.

Workers’ Compensation insurance protects workers from the high cost of occupational injuries. But it benefits employers, too. Most of these policies include Employer’s Liability Insurance, which covers the cost of legal defense, settlements, or judgments if an employee sues you for their injury.

Business owners can also cover themselves under their Workers’ Comp policies if they are worried about suffering a work-related injury or illness. Or they can save money by excluding themselves from coverage.

Not sure if you’re properly covered for Workers’ Compensation? Have other questions about Workers’ Compensation insurance? I can help. Call me at 303-922-1001.