Workers Compensation, States Requiring 3A Coverage for Out-of-State Employees

workers compensation insurance Insured with employees working in New York, either on a permanent or temporary basis should be aware of new regulations requiring out-of-state employers to carry a full, statutory New York State workers’ compensation insurance policy. According to the regulation, an employer has the appropriate coverage when “New York is listed in Item 3A on the Information Page of the employer’s workers’ compensation policy.” Recently, a non Swingle Collins & Associates insured incurred a $65,000 fine after bringing employees to New York to work on a construction project and failing to provide evidence of proper 3A coverage. Florida and Massachusetts have similar laws in place.

The best way to write any workers’ compensation policy is to have your agent add the following language in item 3A of the Information Page for Workers Compensation. “All states except…” and list the monopolistic fund states as the exceptions. A competent agent will understand why this is important and can do this for you. The second best way is to put that language in Item 3C of the Information Page (Other States Insurance). If the insurer won’t use that language, or can’t do it because it isn’t licensed in a particular state or states where employees work, the employer may need a separate policy for those states.

Your agent should be your biggest advocate in determining potential exposures in New York, Massachusetts or Florida and formulating the best plan to ensure your business complies with state regulations.

State by State Comparison of Worker’s Compensation Laws

Worker’s compensation insurance requirements for employers vary from state to state. The differences can be incredibly vast and knowing what insurance requirements state set out for business owners is essential to protecting a business owner’s assets. Some states never require worker’s compensation insurance, while others always require it. For some states, whether workers’ compensation insurance is required depends on the number of employees a business has.

In Alabama, the manner or method by which employers choose to insure worker’s compensation liability is their decision. The state does not generally regulate worker’s compensation requirements for small business owners. Conversely, California requires worker’s compensation insurance in every work situation, regardless of the number of employees. Connecticut requires employers to have worker’s compensation insurance if they employ at least one employee, while Florida requires employers to have worker’s compensation insurance when the employer employs at least four employees.

The most common exemptions in workers’ compensation coverage are for agricultural employees, corporations or exempted members of limited liability companies. Each state has selected its own administrator for workers compensation, and it may be helpful to contact that states administrator.

Like most insurance requirements, states requirements are always evolving. It is more important now than ever to have an educated risk manager / insurance advisor who stays connected to the complexities and intricacies of insurance regulations and policy language.

Swingle, Collins & Associates specializes in workers’ compensation insurance coverage The descriptions of coverages listed on this website are brief and subject to the provisions, limitations, and exclusions that can only be expressed in your policy and related endorsements. For additional information of how Swingle, Collins & Associates can assist in meeting your coverage needs for workers’ compensation insurance, please contact your dedicated risk manager to discuss the benefits and services of workers’ compensation insurance coverage.

The information contained on this page is provided for informational and educational purposes only. It contains general information on insurance issues and may not reflect the most current developments in insurance coverage and is unlikely to apply in all factual scenarios. The information does not include all the terms, coverages, exclusions, limitations or conditions that may be contained in the actual insurance contract language. The policies themselves must be read for those details. Sample policy forms will be made available upon reasonable request.