North Carolina Workers' Compensation Insurance

Your Guide to Workers' Comp Insurance in North Carolina

Find the right workers' comp insurance policy for you.

North Carolina Workers Compensation Insurance

In recent years, North Carolina has paid out $6.285 billion in workers' comp claims. Work-related injuries happen every day, from trips and falls to life-altering injuries, but having the right workers' comp coverage can help protect your business. For help navigating workers comp insurance coverage, find a local independent agent.

Workers' Compensation Coverages/Non-Coverages in North Carolina

Employees need help paying for medical bills when they get injured on the job. Workers’ compensation insurance is designed to protect employees from the costs of workplace injuries, and protect employers from lawsuits and other unpredictable costs.

Here's a closer look at what workers' compensation covers and does not cover in the state of North Carolina.

Workers' comp covers the following:

  • Traumatic injuries
  • Repetitive-type injuries
  • Certain mental injuries
  • Occupational diseases

Real-life example of coverage:

A waiter at a North Carolina restaurant gets a severe burn from a hot plate. The employee gets taken to the hospital to be treated for their injuries. A workers' comp policy would help pay for any related medical treatments and other costs.

Workers' comp does not cover:

  • Employee illnesses or injuries sustained outside of work
  • Accidents that occur while an employee is intoxicated
  • Intentional employee injuries to themselves at the workplace
Workers' Compensation Coverage Covered Not Covered
Traumatic injuries
Repetitive-type injuries
Certain mental injuries
Occupational diseases
Employee illnesses or injuries sustained outside of work
Accidents that occur while an employee is intoxicated
Intentional employee injuries to themselves at the workplace

An independent insurance agent can further explain what workers' compensation insurance both covers and excludes in North Carolina.

Why Do You Need Workers Compensation Insurance in North Carolina?

Workers' comp insurance is a necessity for most businesses for several reasons. For starters, it's actually required by law in most states, if your business has employees. Workers' comp also provides critical protection for your business against financial losses.

For most states, workers' comp is required immediately upon hiring a new employee. You'll want to be equipped with coverage before any of your workers get injured or ill on the job so that your business won't be held financially liable. Coverage doesn't kick in for workplace incidents until after you purchase a policy.

What Consequences Could You Face if You Don’t Have Workers’ Compensation in North Carolina?

If your business doesn't carry workers' comp to protect your team, you could end up facing legal consequences like fines or jail time. Though some businesses think of workers' comp as optional or unnecessary due to the nature of their operations, coverage can provide important financial protection in case of an incident.

Workers' comp is mandatory in most states, including North Carolina, if your business has three or more employees. Businesses in North Carolina without the right workers' comp can be subject to a fine of between $18,250 to $36,500 per year that they lacked coverage, or one dollar per employee per day. Criminal charges may also be brought against the business.

North Carolina Workers’ Compensation Laws and Regulations

North Carolina requires all businesses that regularly employ three or more employees, part-time or full-time, to obtain workers’ comp or qualify as self-insured employers. North Carolina’s workers’ comp program is a no-fault system, meaning employees are guaranteed benefits regardless of who's at fault for an accident or injury. Employees forfeit the right to sue their employers.

A North Carolina workers’ compensation policy protects your employees not only when they are at the office, but also when they are out of the office, as long they are performing a work duty. Employees who are traveling for work, working at a client site, or even at an after-hours work event, are all protected by your policy.  

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How Much Does Workers’ Comp Insurance Cost in North Carolina?

North Carolina doesn’t use the National Council on Compensation Insurance (NCCI) classification system to set class codes for employees. The North Carolina Rate Bureau sets class codes and base premium rates, which are designed to reflect how dangerous a particular job is when compared to other careers. 

A high-risk job will carry a higher base rate than a job that has a lower accident and claim rate. Class codes are used to identify the various types of workers at a business and set a base rate for their workers’ compensation premiums. Rates are reviewed on a yearly basis, so your workers’ compensation costs will fluctuate.

Here's an example of how base rates are used to set premiums:

  • North Carolina Classification Code: 5190 Electrical
  • Base Rate: $4.57
  • Employer Payroll: Example: $100,000
  • Premium Calculation: $4.57 per $100 or 4.57% of payroll.
  • Estimated Annual Premium: $4,570

Most businesses will have more than one class of employee. This electrical company could also employ sales and administrative staff in addition to  electricians. All employee types fall under different class codes. To calculate your business's rates, you'd need to add up the class codes and resulting premiums. 

North Carolina Base Rate Examples

Rates for workers' comp insurance in North Carolina may vary among insurance companies based on underwriting standards and credits offered by individual insurers.  

Here are some sample base rates (rate per $100 of employer payroll):

  • 5221 Concrete Construction  $4.33
  • 5437 Carpentry/Trim  $5.97
  • 5474 Painting  $6.50
  • 5478 Flooring  $3.64
  • 5645 Carpentry NOC Residential Construction  $14.26
  • 7228 Short Haul Trucking  $7.56
  • 8006 Gas Station  $3.09
  • 8017 Retail Store  $1.64
  • 8380 Auto Shop  $2.57

Workers' Comp Cost Per Employee in North Carolina

The cost of workers' comp coverage per employee increases with higher company payrolls, as these businesses cost more to insure. Check out a breakdown of how workers' comp costs vary by payroll range in each specific industry below.

Annual Workers' Comp Cost Per Employee

Industry Lower Cost Medium Cost Upper Cost
Construction $1,550 $2,970 $11,363
Finance and Insurance $510 $921 $3,372
Hotels / Motels $374 $841 $3,552
Manufacturing and Food Production $663 $1,259 $4,786
Professional and Technical Services $479 $948 $3,709
Real Estate $86 $172 $672
Restaurants and Taverns $152 $339 $1,426
Retail Trade $292 $561 $2,146
Transportation and Warehousing $1,141 $2,248 $8,763

Businesses that have a greater track-record of safety and fewer accidents pay less for their coverage. Insurance companies have complex formulas to reset your rates after an accident, likely leading to a noticeable spike in your premiums.

Best Workers' Comp Companies in North Carolina

Workers' comp is available from many different insurance companies in North Carolina. Here are just a few of our top picks for quality workers' comp insurance carriers.

Top Workers' Compensation Insurance Companies Star Rating
Central Insurance Companies
5 star rating
Nationwide 
5 star rating
Liberty Mutual
4.5/5 star rating
Builders & Tradesmen's Insurance
4.5/5 star rating
Travelers
5 star rating

An independent insurance agent can help you look into these workers' comp insurance companies and get matched to the carrier who best meets your needs at the most affordable rate.

Top 6 Most Common Workers' Comp Claims/Injuries

Top 6 Most Common Workers Comp Claims
  1. Lacerations: In other words, deep cuts. These can happen in any industry, but are especially common in the restaurant and manufacturing fields. 
  2. Sprains/strains: Again, these injuries can happen in any industry, but are especially common in job settings where lots of twisting and turning is required.
  3. Contusions: In other words, bruises and other marks on the skin caused by impact. Contusions often happen from dropped objects, improper lifting, or colliding with an object.
  4. Burns: Burns can happen in any industry that has a heat source, including restaurants, construction businesses, bakeries, and more.
  5. Eye injuries: Eye injuries are most frequent in industries that require chemicals, including manufacturing, painting, and construction.
  6. Fractures: Fractures can happen to employees anywhere, but are especially common in industries that require a lot of movement and the use of heavy machinery.

Why Are Independent Insurance Agents Awesome?

It’s simple. Independent insurance agents simplify the process by shopping and comparing insurance quotes for you. Not only that, but they’ll also cut the jargon and clarify the fine print, so you know exactly what you’re getting.

There’s no business too small for our independent insurance agents. They have access to multiple insurance companies, ultimately finding you the best workers' comp coverage and competitive pricing while working for you.

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TrustedChoice.com Article | Reviewed by Paul Martin

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