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

Workers' Compensation Insurance Laws in Pennsylvania

  • With few exceptions, all Pennsylvania employers must carry workers’ compensation insurance.
  • Employers must present their employees with information about their workers’ compensation rights and authorized medical providers when they are hired. This information should be given to them again if they are injured.
  • With the exception of necessary emergency treatment, all workers’ comp medical treatments within the first 90 days must be obtained through an employer-authorized physician, and treatments must be authorized by designated panel physicians.
  • Failure to carry required workers’ compensation insurance in Pennsylvania can result in liability lawsuits filed by employees and in criminal prosecution by the commonwealth.

Common Workers' Compensation Claims in Pennsylvania

Insurance companies in Pennsylvania pay out more than $650 million a year in workers’ compensation insurance claims.

Top 10 causes of worker injuries in Pennsylvania:

  1. Overexertion
  2. Struck by or against an object
  3. Bodily reaction
  4. Trip. slip, and fall (same level)
  5. Caught in or under something
  6. Exposure to radiation, caustics, etc.
  7. Transportation accidents
  8. Falls from a higher level
  9. Contact with temperature extremes
  10. Contact with electricity

Top 5 Industries with the most workers’ comp claims in Pennsylvania:

  1. Agriculture, forestry, fishing & hunting
  2. Mining
  3. Construction
  4. Manufacturing
  5. Trade, transportation & utilities

There are more than 170,000 workers' compensation insurance claims filed in Pennsylvania every year.

FAQ: Workers' Compensation Insurance in Pennsylvania

Workers' compensation insurance is a commercial insurance policy designed to protect employers and the people who work for them.

It shields the employer from financial losses and potential liability lawsuits if an employee is severely injured on the job or is stricken with an occupational illness. 

It protects employees by ensuring that if they are injured on the job, they will have full coverage for all necessary medical care and related expenses and not suffer a significant financial setback due to lost wages.

Workers’ compensation costs are based primarily on the number of employees you have, how much they are paid, the types of jobs they do, and your company's history of accidents and workers’ compensation claims. 

The Pennsylvania Rating Bureau assigns every occupation a base rate for coverage according to the likelihood that an employee will be severely injured while doing it. Insurance companies are required to use these base rates, but they can make adjustments up to 25% through policy credits or debits.

The following are examples of workers' compensation cost ranges per $100 of employer payroll in Pennsylvania:

  • Landscapers:  $3.48 to $11.09
  • Tree trimmers, removers, and pruners:  $8.02 to $25.26
  • Asphalt and paving workers:  $4.66 to $14.85
  • Roofing contractors:  $11.36 to $36.20
  • Retail store workers:  $1.33 to $4.24
  • Clerical/office employees: $0.08 to $0.25
  • Restaurant workers:  $0.96 to $3.06

Employers who have a solid history of employee safety will pay rates at the lower end. In comparison, those whose workers' injuries exceed industry expectations will pay rates at the higher end.

To determine how much workers’ compensation insurance will cost for your Pennsylvania business, you can consult a local independent agent.

Pennsylvania state law requires all employers with at least one employee to carry workers’ compensation insurance.

There are a few exceptions. Coverage is not required for:

  • Sole proprietors, partners, and corporate officers
  • Household/domestic workers
  • Real estate salespeople and brokers
  • Casual employees
  • Railroad employees
  • Longshoremen
  • Licensed insurance agents who work on commission only

Additionally, there are some provisions for farmers. Farmers who employ just one employee who works fewer than 30 days a year or earns less than $1,000 a year are exempt from needing to buy coverage. Additionally, farmers are not required to purchase coverage for their spouses or children under 18.

In Pennsylvania, workers' compensation insurance can be purchased from a commercial provider or, for high-risk and hard-to-insure businesses, through Pennsylvania’s state-administered fund. With approval, financially sound businesses may opt to self-insure.

In Pennsylvania, workers' compensation insurance can cover employees injured on the job or diagnosed with an occupational illness. If a claim is approved, workers’ compensation insurance will pay for:

  • Medical care: If treatment has been authorized by a designated panel of physicians. Care remains within the authorized physician network. Workers’ compensation insurance in Pennsylvania will provide full coverage, so the employee pays nothing out of pocket.
  • Mileage and travel reimbursement: If necessary medical treatment is not available within the employee’s normal geographical area, workers’ compensation insurance can reimburse the employee for miles driven to obtain this care.
  • Disability pay: Employees that must take more than seven days off work to recuperate from a work-related injury or occupational illness are entitled to disability pay.
  • Permanent disability benefits: Employees who sustain permanent loss of function, scarring, or disfigurement to the head, face, and/or neck can be awarded compensation in addition to the disability payments mentioned above.
  • Death benefits: In worst-case scenarios, workers’ compensation can cover burial costs up to $7,000 and provide the deceased employee’s spouse and dependents with ongoing death benefits.

Workers’ compensation covers most worker injuries, but it does have some exclusions.

Workers' compensation insurance will not cover claims involving:

  • Injuries that were not reported to the employer within 120 days
  • Claims that were not submitted to the insurer within three years of the date of injury
  • Employee injuries that did not occur on the job
  • Injuries and illnesses that were preexisting conditions
  • Accidents that occurred while the injured employee was under the influence of illegal drugs or alcohol
  • Intentional or self-inflicted injuries
  • Injuries that occurred while the employee was committing a crime
  • Acute, common illnesses like influenza, headaches, and colds

Contractors often have to show prospective clients that they are covered by workers’ compensation coverage, particularly if they are trying to win a government contract. This is because their clients want to be certain that they will not be named in a liability lawsuit if a worker is injured while doing a job for them.

If you are asked to provide proof of coverage, you will need a workers’ compensation insurance certificate. This is a document that provides information about your coverage including details like:

  • Name and address of the insured
  • Name of the insurance provider and all relevant policy numbers
  • Effective date and expiration date for each policy listed

You will be issued this certificate by your insurance company when you purchase or renew your policy. 

Independent insurance agents in Pennsylvania make it easy to find the best workers’ compensation coverage. These agents are free to work with several competing insurers, so they can present you with policy and rates from a selection of insurance companies that specialize in covering businesses in your industry.

No business in Pennsylvania is too small to benefit from having the help of an independent agent. Set up an obligation-free consultation with an independent insurance agent near you to learn more.

Workers' compensation benefits received by employees are not considered taxable income at the state or federal level.

What Are the Best Workers' Compensation Insurance Companies in Pennsylvania?