Find the Best Workers' Compensation Insurance Options in New Jersey
There are about 884,000 small business owners in New Jersey. Everyone who owns or runs a company in New Jersey should at least consider getting workers' compensation insurance. This insurance provides reimbursement for lost wages and medical expenses after an employee gets injured or ill due to their job. Also, workers' comp is usually mandatory for most businesses in the US. In New Jersey, workers' comp is mandatory for businesses with one or more employees, with only a couple of exceptions.
Fortunately, an independent insurance agent in New Jersey can help your business get set up with the right workers' comp fast. They'll match you to a policy with the right amount of coverage at an affordable rate. But until then, here's an overview of New Jersey workers' comp requirements and more.
New Jersey Workers' Compensation Laws
New Jersey workers' compensation requirements can sometimes vary depending on a business's industry. But most New Jersey businesses with at least one employee must have workers' compensation insurance by state law. However, businesses without employees usually aren't required to carry coverage. This is the case for sole proprietors and others in this category.
How Does Workers' Compensation Insurance Work in New Jersey?
New Jersey workers' compensation insurance offers benefits and reimbursement to employees who suffer from an illness or injury on the job or due to their work duties. To qualify for reimbursement from workers' comp, the incident must have been due to an unsafe job site, work tasks, or the equipment or materials used for the job. New Jersey workers' comp can also replace a portion of an employee's regular wages or salary if they need time off to recover or get treatment. New Jersey workers' comp can reimburse a business for the costs of labs, prescription medications, funeral expenses, doctor or hospital visits, and more.
Workers' comp is a part of a complete New Jersey business insurance policy. This coverage comes with the added benefit of exempting your company from employee lawsuits related to covered incidents. Family members of affected employees are also unable to sue the business. Workers' comp insurance in New Jersey can help protect your team and business from potentially hefty financial losses.
New Jersey Workers' Compensation Exemptions
New Jersey state law does exempt a couple of types of businesses and professionals from being required to carry workers' comp. Understanding the state's exemptions is key to knowing if your business needs to be covered. Here are New Jersey workers' comp exemptions:
- Sole proprietors without employees
- Independent contractors
- Unpaid volunteers
- Unpaid interns
These types of workers and businesses do not need to be covered by workers' comp in New Jersey. A New Jersey independent insurance agent can also help determine if your business is required by state law to have workers' comp.
Do Independent Contractors Need Workers’ Comp Coverage?
According to state law, Independent contractors and freelancers in New Jersey don't need to be covered by workers' comp. Workers who aren't classified as employees in New Jersey aren't required to be covered by workers' comp. However, if an independent contractor's work is risky, they may still prefer to be covered in order to get the protection that they need.
Many businesses and independent contractors in New Jersey still decide to get coverage for this reason. Independent contractors and freelancers won't be penalized by law for not being covered by workers' comp, but this coverage can still provide important financial reimbursement for work incidents. If an incident occurs, not having coverage could end up costing you much more than the cost of workers' comp premiums.
Do New Jersey Business Owners Need to Be Covered by Workers’ Compensation?
There are also exemptions for a couple of types of business owners in New Jersey. Workers' comp is not required if they are partners in a business partnership, sole proprietors without any employees, members of LLCs, or are already covered by federal programs. If a business owner falls into one of these categories, they're exempt from the state's workers' comp requirements.
Having workers' comp just in case can still help you save a lot of money if there's an incident, though. Even one unexpected workplace illness or injury can result in costly medical treatment and lost time from work, so you may still want to get coverage to avoid these possible losses. Without workers' comp, you'd have to pay these costs out of pocket, which could result in a huge loss for you or your business.
What Does New Jersey Workers' Compensation Cover?
New Jersey workers' comp can reimburse employees for a number of different expenses. These can include funeral costs, doctor visits, hospital stays, medications, treatment, and more. Since many types of expenses can result from an employee's injury or illness, workers' comp coverage is expansive. New Jersey workers' comp can also replace a portion of an affected employee's regular wages or salary if they need time off for recovery, treatments, etc.
New Jersey workers' comp can reimburse funeral costs if a workplace incident leads to an employee's death. Businesses are exempt from employee lawsuits for covered incidents, even if they result in death. The affected employee's family members cannot sue the business either if workers' comp was available. Knowing this, having workers' comp for your New Jersey business is critical for protecting your team and business.
Here's more of what workers' comp covers in New Jersey:
- Ongoing care: Workers' comp can help pay for required ongoing care costs to continue treating a covered injury or illness. If a worker needs physical therapy due to a workplace injury, this coverage can help pay for that cost.
- Medical expenses: Workers' comp can help pay for medical expenses after covered incidents, including prescription medications. If an employee needs a prescription for chronic pain due to their job tasks, workers' comp can pay for it.
- Death benefits: Workers' comp can also help pay death benefits for employees who die due to a covered incident. The death benefits are most often paid to an employee's surviving dependent family members or spouse.
- Funeral costs: Workers' comp can even help cover funeral costs for deceased employees due to a covered incident. Reimbursement can apply to burial costs, coffins, and more.
- Disability benefits: Workers' comp can also help pay for disability benefits, including temporary total disability benefits, permanent partial disability benefits, and permanent total disability benefits. If an employee qualifies for disability benefits due to a workplace incident, workers' comp can help cover these costs.
- Time off during recovery: Workers' comp can help pay to replace some of an employee's wages while they take time off work to recover from a covered incident. If an employee needs to stay at the hospital for two weeks after surgery due to a workplace incident, workers' comp can help continue some of the wages they would've earned during that time.
A New Jersey independent insurance agent can help you further understand what your workers' comp policy covers.
How Much Does Workers’ Compensation Insurance Cost in New Jersey?
The average cost of workers' compensation insurance in New Jersey is $44 per month or $528 per year. This cost can vary based on many factors, though. The exact number of workers your business employs and its annual payroll impact the cost of workers' comp.
Also, your company's exact location and industry influence workers' comp costs. Some industries have a higher risk level, including those in the trucking and construction industries, so insurance companies must charge more for coverage. Your business's claims history and the limits applied to coverage also affect the cost of workers' comp.