Workers’ Compensation Insurance in Farmington, CT
Workers’ compensation insurance for Farmington, CT employers who just hired someone
Workers’ compensation insurance is the policy most Farmington, CT business owners buy in a hurry. The first employee starts Monday, the payroll company asks for a policy number, or a general contractor will not let you on site without a certificate. The Beam Agency writes workers’ comp for contractors, restaurants, landscapers, offices and shops across the Farmington Valley and Hartford County, and we can usually bind a new policy within a few business days of getting payroll and class information.
The policy itself is simple. Getting it rated correctly, and not overpaying at audit, is where an agent earns the commission. Brandon has spent more than ten years on the carrier and agency side of Connecticut insurance and has seen most of the ways this policy goes wrong.
What Connecticut requires
All Connecticut employers with employees must carry workers’ compensation insurance. That is the rule from the Connecticut Workers’ Compensation Commission, and it applies whether the employee is full time, part time or seasonal. There is no headcount threshold to hide under. One employee is enough.
A few elections are available:
- Sole proprietors are not required to cover themselves, but may elect coverage. Many do, because a one-person contractor with no policy cannot get on a GC’s job site.
- Corporate officers and LLC members may elect to be excluded from coverage. This lowers premium because your own pay comes out of the rated payroll. It also means you have no workers’ comp benefits if you are hurt on the job, so think about your health and disability coverage before signing the exclusion.
If you are a subcontractor working for a general contractor in Avon or West Hartford, the state’s rule is not the one that matters. The GC’s contract is. Most require every sub, including a sole proprietor, to carry workers’ comp or produce a signed waiver, and many have stopped accepting waivers. Our contractor insurance page covers that side in more detail.
What it covers
Medical treatment
Workers’ comp pays for the medical care an employee needs after a work injury, from the emergency room visit to physical therapy, without a deductible or copay to the employee.
Lost wages
If the injury keeps the employee out of work, the policy pays a portion of their lost wages according to the Connecticut benefit schedule. This is what keeps a hurt employee from suing you for the rent.
Employer’s liability
Part Two of a standard policy. It covers lawsuits that fall outside the workers’ comp system, such as a third-party-over claim where the injured worker sues the property owner and the owner sues you. The usual limits are $100,000/$500,000/$100,000, and most GCs ask for $500,000 or $1 million. It costs little to raise them.
How the premium is rated
Workers’ comp premium is payroll times a rate for each class code, divided by 100. A roofer’s class code carries a much higher rate than a clerical code, so a shop with a $200,000 payroll can pay a very different premium depending on how that payroll is split.
Three things move the number:
- Class codes. Every job in the business gets a code. Field employees, an office manager, a salesperson who visits sites and an owner who mostly estimates are all rated differently. Getting these right at the start is the single biggest lever.
- Experience modification. Once your premium is large enough to qualify, the rating bureau assigns an experience mod based on your claims history against the average for your class. A mod under 1.00 is a credit. A mod over 1.00 is a surcharge, and some GCs will not hire a sub with a mod above 1.00.
- Carrier appetite. Carriers price the same class code differently. Travelers is one of the markets we use, alongside other A.M. Best-rated carriers, and for hard-to-place classes we have excess and specialty markets.
Audits and subcontractor certificates
Workers’ comp is sold on estimated payroll and settled at audit. After the policy year ends, the carrier confirms actual payroll and sends a bill or a refund for the difference. This is where owners get surprised.
The most common surprise is subcontractors. If you paid a sub who cannot produce a certificate of insurance showing their own workers’ comp, the auditor typically adds what you paid them to your payroll and charges you for it. Collect certificates before you pay a sub, keep them in a folder, and the audit goes quickly. Certificates of insurance explains what to ask for.
Where people get caught
- Misclassification. Putting a field employee under a clerical code saves money until the audit or the claim, and then it costs more than it ever saved.
- Waiting for the first hire. Payroll starts, the policy does not, and the employee is hurt in week two. Line the policy up before the start date.
- Paying cash helpers. A day laborer is still an employee for workers’ comp purposes.
- Excluding an officer who actually swings a hammer. The exclusion is fine for someone who runs the office. It is a gamble for someone on the roof.
- Letting it lapse between jobs. Seasonal businesses sometimes cancel in winter. If a GC pulls your certificate in February, that is a problem.
What it costs in Connecticut
There is no flat price. A small office in Farmington with two clerical employees often pays a few hundred dollars a year. A landscaping company in Burlington with a $150,000 field payroll pays considerably more, and a roofing crew more than that. We will run the numbers by class code and show you how the estimate was built so nothing at audit is a surprise.
Who this is for
A restaurant in Plainville hiring its first two line cooks. An electrician in Bristol who has worked alone for years and just took on an apprentice. A landscaper in Simsbury adding a summer crew. A New Britain shop that got an audit bill it did not understand. A new business in Farmington that needs a policy number before payroll runs. Workers’ comp pairs with general liability and, for anyone with a work truck, commercial auto, and we usually quote all three together.
Workers’ comp questions
Do I need workers’ comp insurance in Connecticut if I only have one part-time employee?
Yes. Connecticut requires all employers with employees to carry workers’ compensation, and there is no exemption for part-time or seasonal staff. A sole proprietor with no employees is not required to carry it but may elect coverage.
Can I exclude myself from workers’ comp as an LLC owner in Connecticut?
LLC members and corporate officers may elect to be excluded. It reduces premium because your pay comes out of the rated payroll, but you give up benefits if you are hurt working. If you are in the field every day, we usually suggest staying covered.
How much does workers’ comp cost for a small business in Connecticut?
It depends on payroll and class code. A small office may pay a few hundred dollars a year. Trades pay more because the rates are higher, and roofing and framing are at the top. Send us your payroll by job type and we will quote it.
What happens at a workers’ comp audit?
The carrier confirms actual payroll for the policy year and bills or refunds the difference from the estimate. Payments to subcontractors without their own workers’ comp certificates are usually added to your payroll, so collect certificates before you pay.
Independent agent, direct line
Talk to Brandon directly
One agent, multiple carriers, and a policy read line by line before you sign it.