By law, every business with over five employees must carry workers’ compensation insurance in Missouri. While that law seems straightforward, there are many underlying question marks that come along with this kind of coverage. Do all employees and contractors need to be covered with worker’s compensation insurance? Who is exempt from these policies? And what happens if there is a claim?
To help you get clarification and sift out what your business needs, let’s examine Missouri’s laws around workers’ compensation a little closer.
Who Needs Workers’ Compensation Insurance in Missouri?
As I mentioned above, every business with over five employees must carry workers’ compensation insurance in Missouri. The legal definition of who qualifies as an employee isn’t limited to full-time workers alone. Part-time, seasonal, or temporary workers are also included under Missouri’s definition of an employee.
The big exception to this rule is any business that operates in the construction industry. If your business is considered part of the construction industry, then your workers are regularly exposed to a higher-risk work environment. Missouri law states that your company must carry workers’ compensation insurance if you have at least one employee instead of five.
Who’s Exempt from Missouri Workers’ Compensation Insurance?
In some cases, employees can be exempt from workers’ compensation insurance policies. The following employee types do not need to have this type of coverage:
- Farm laborers
- Domestic servants
- Some types of real estate agents
- Direct sellers
- Commercial motor-carrier owner-operators (or commercial truckers)
Business owners can sometimes be exempt from a worker’s compensation policy too. If you’re a sole proprietor, part of a partnership that owns a firm, or an independent contractor, you do not need to include yourself as one of the five employees of your company.
Even though you have less than five employees, exempt employees, or are exempt yourself as a business owner, you may still purchase workers’ compensation insurance. Even though this type of coverage is not required, it can still protect you and your business in the long run from high-cost work injury expenses.
How Does Workers’ Compensation Insurance Work in Missouri?
Workers’ compensation insurance in Missouri kicks in as soon as an employee gets injured on the job or develops an occupational illness. This insurance is there to cover the high costs of medical care to treat the injury, illness or disability. Here’s what’s included:
- Medical benefits
- Temporary total or partial disability benefits
- Permanent total or partial disability benefits
- Death benefits
Each policy will often include the employer’s limited liability insurance, which will also help cover legal costs that result from lawsuits following an injury. Still, many exclusive remedy provisions in workers’ compensation policies prevent an employee from being able to sue an employer if they accept workers’ compensation benefits.
How Do I Get Workers’ Compensation Insurance in Missouri?
Workers’ compensation insurance can be obtained from insurance agents, just like other business insurance policies.
If for some reason, a business does not qualify for workers’ compensation insurance, the company can buy it from Missouri’s Workers’ Compensation Assigned Risk Plan. This should be a last resort.
Another option for businesses is to opt to self-insure. This means that if an employee gets injured on the job, the company will pay for the injuries in full and will not be covered for legal expenses if an employee files a lawsuit against the company. The option to self-insure is only available to individual employers or employers who are part of an employer group. This requires that you’re certified by the Missouri Division of Workers’ Compensation.
What If I Choose Not to Get Workers’ Compensation Insurance in Missouri?
Neglecting to offer workers’ compensation insurance may result in you being charged with a misdemeanor. In addition, if you’re found guilty of refusing this type of coverage, you could face a penalty of up to triple the amount your premium would have been, up to a maximum of $50,000. In addition, you will have to pay for any employee injury expenses.
How Do Settlements Work When a Workers’ Compensation Claim is Filed?
In Missouri, workers’ compensation settlement claims are full and final. That means, once an employee agrees to receive benefits, they are unable to receive any future workers’ compensation benefits. Still, if an employee requires future and extensive medical treatments, insurance companies may often agree to pay for them despite the claim being closed.
If an employee dies as a result of a work-related injury or illness, family members can receive death benefits. These will include weekly payments to cover a portion of the deceased employee’s income and up to $5,000 for burial costs.
