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
  • Freelancers

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.

National Average Cost of Workers' Compensation Insurance

Healthcare $1,825 Per $100,000 payroll

Retail Trade $2,850 Per $100,000 payroll

Construction $7,430 Per $100,000 payroll

How Can New Jersey Business Owners Save Money on Workers’ Comp?

New Jersey business owners have some options to save money on workers' comp premiums. The first is a "pay-as-you-go" payment option that offers a low upfront premium. This payment method gives your business the added benefit of buying coverage based on actual payroll instead of projected or estimated payroll, which can greatly reduce costs. Hiring seasonal or casual employees or having a fluctuating number of workers can also help bring down workers' comp costs.

Safety training and programs can also reduce the cost of workers' comp for a business. Submitting proof to your insurer that your employees have undergone safety training can help reduce premium costs. The more measures you take to try to prevent workplace incidents, the lower your premiums can be. Make sure to send proof of any safety measures your business has taken to your insurance company.

What Are the Penalties for Not Having Workers' Comp in New Jersey?

Any business owner in New Jersey who doesn't comply with the state's workers' comp laws can face fines and other harsh penalties. These can start with fines and increase to criminal charges, including fourth-degree felonies. For the first 20 days, if a business is found non-compliant with workers' comp laws, it can be charged a fine of $5,000 and another $5,000 for each window of 10 days afterward. 

The state's Department of Labor and Workforce Development Division of Workers' Compensation can also seize a business's property for non-compliance. A business can also face a fourth-degree felony criminal charge for failure to provide workers' comp. To be safe, make sure your business is always equipped with the required amount of workers' comp. This can help guarantee your business will avoid any severe penalties.

Best Workers' Compensation Insurance Companies in New Jersey

Many carriers sell workers' comp in New Jersey. However, you want your business to have the best coverage available. That's why we put together this list of a few of the best workers' comp insurance companies in New Jersey for you. Check into these outstanding carriers first.

  • Progressive: Progressive has been around for decades and has an outstanding financial strength rating from AM Best. The carrier also offers 24/7/365 customer service.
  • Travelers: Travelers is another longstanding carrier with excellent customer feedback. Travelers is known for affordable rates, many discount and endorsement options, and great financial strength.
  • Encova: Encova has outstanding financial strength ratings and Better Business Bureau (BBB) ratings. The carrier also offers 24/7 claims reporting.
  • Liberty Mutual: Liberty Mutual is a Fortune 500 company with a reputation for providing quality service and coverage. The carrier also has excellent AM Best and BBB ratings and offers 24/7 claims reporting.

A New Jersey independent insurance agent can help your business get set up with workers' comp from one of these top-rated local carriers.

What Are the Best Workers' Compensation Companies in New Jersey?

Top Workers' Compensation Insurance CompaniesStar Rating
5 star rating
5 star rating
5 star rating
Liberty Mutual
4.5/5 star rating

FAQs: Workers' Compensation in New Jersey

New Jersey workers' compensation covers incidents of injury or illness to employees. These incidents are covered if they're caused by the work environment, tools, chemicals, or equipment used for the job, or job duties. 

The average cost of workers' comp in New Jersey is currently $44 per month. However, this cost can vary due to many factors, such as the number of employees your company has.

Yes, New Jersey state law mandates workers' compensation for businesses with one or more employees. If your business doesn't have employees, you're not required by the state to have coverage.

In New Jersey, workers' compensation insurance covers medical expenses and a portion of lost wages for an employee who gets injured or ill as a result of the job. Costs of medications, funeral expenses, death benefits, doctor visits, etc., can be reimbursed by workers' comp if an incident is eligible for coverage.

Some incidents are excluded by a New Jersey workers' compensation policy. Here are some exclusions under New Jersey workers' compensation insurance:

  • Intentional injuries or illnesses
  • Injuries or illnesses sustained outside of work
  • Injuries or illnesses sustained while behaving negligently
  • Injuries or illnesses sustained under the influence of drugs or alcohol
  • Injuries or illnesses related to preexisting conditions

Your business may receive a request for proof of workers' compensation at some point. This is known as a Certificate of Insurance, and it provides the limits, expiration dates, and agent signature on your behalf. You can obtain a certificate from your New Jersey independent insurance agent or the insurance company you got coverage through for no additional fee. 

A New Jersey independent insurance agent can help you find workers' compensation coverage for an affordable price. These agents are free to shop and compare policies and quotes from several local carriers. They'll get you matched to a policy that offers the best blend of coverage and cost.

No, the benefits received by a workers' comp policy are not taxable in New Jersey. Workers' comp is not taxable by the state or the federal government.

The industries with the most reported fatal occupational injuries in New Jersey include:

  1. Education and health services
  2. Trade, transportation, and utilities
  3. Manufacturing
  4. Natural resources and mining
  5. Leisure and hospitality

The most commonly reported fatal occupational injuries in New Jersey include:

  1. Overexertion
  2. Slips, trips, and falls
  3. Burns and electrocutions
  4. Injuries caused by equipment malfunctions
  5. Repetitive motion injuries
  6. Motor vehicle collision injuries
  7. Getting hit by falling objects
  8. Strains and sprains
  9. Punctures, cuts, and lacerations
  10. Fractures

The statute of limitations for workers' comp in New Jersey is two years. If an incident gets reported after this period is over, it may not be covered by workers' comp.

In New Jersey, if you're a sole proprietor with no employees, a member of an LLC, or a partner in a business partnership, you can go through your own insurance. Otherwise, businesses in New Jersey with at least one employee must be covered by workers' comp.,resulting%20from%20a%20work%20injury.,considered%20a%20payment%20of%20compensation.