Are Business Owners Covered by Workers Compensation insurance?

When it comes to workers’ compensation insurance in Arizona, business owners often wonder if they themselves are covered under the policy they provide for their employees. Understanding the specifics of workers’ compensation coverage is crucial for ensuring compliance with state laws and protecting both employees and employers.

What is Workers Compensation?

Workers’ compensation is a type of insurance that can provide coverage such as medical benefits and wage replacement to employees who are injured while on the job. In Arizona, it is mandatory for employers to carry workers’ compensation insurance for their employees, regardless of the number of employees.

Are Business Owners Required to Have Workers Compensation?

Even though there may be exceptions, Arizona business owners in general are not required to purchase workers’ compensation insurance for themselves.  However, you may have the option to include yourself in the coverage if you choose to do so.

Why Might a Business Owner Choose to Opt-In?

While it may not be mandated by State law in your situation, there are several reasons why a business owner might choose to opt-in to workers’ compensation coverage:

1. Protection: Including yourself in the coverage ensures that you are protected in case of a work-related injury or illness, especially if you don’t have health insurance.
2. Peace of Mind: Knowing that you have coverage can provide peace of mind and allow you to focus on running your business.
3. Financial Security: Workers’ compensation can help cover medical expenses and lost wages, reducing the financial burden of an injury.
4. Contract requirements: If you are hired by someone usually as an independent contractor, you may be required by them to have workers compensation coverage for yourself.

How to Opt-In for Coverage

If you decide to include yourself in your workers’ compensation policy, you will need to inform your insurance agent and adjust your policy accordingly. This may involve additional premiums, but it ensures that you are covered in the event of an injury. Depending on the industry that you are in, you may be surprised to know that having coverage for yourself can be less expensive than you think.

Conclusion

While in general business owners in Arizona are not required to have workers’ compensation insurance for themselves, opting in can provide valuable protection and peace of mind. It’s important to weigh the benefits and costs and make an informed decision that best suits your needs and circumstances.