Out-of-State Workers' Compensation Guide
Workers’ compensation is something most companies don’t think about until there’s a workplace injury. Because workers’ comp is regulated individually in each state, it’s important to know how to navigate the system when performing work outside of your home state. The most common questions – along with their answers – are listed below.
“When do I need to report out-of-state work?”
The answer is anytime you have an employee crossing a state border. Even if that employee is working out of state for only a day, always report the new state to your broker. This helps ensure you have the appropriate statutory coverage added to your policy. Further, some states require specific reporting by the carriers and fines or penalties can result if those reporting procedures aren’t followed.
Reporting early also provides you with estimated rates and premiums. The cost for the exact same type of work can vary wildly between states, so you should never assume that what you’re paying in your home state is what you’ll pay elsewhere. Reporting provides you the tools you need to accurately budget and bid.
“What happens when an employee gets injured out-of-state?”
While not always applicable, the general rule of thumb is that an employee can decide to collect benefits in either their “home” state or the state in which the injury occurred. Which state’s benefits apply will determine your rights and responsibilities as an employer. You'll need to consult with your Assurance claims representative to determine what actions you may need to take.
Since state rules are so different, remember these guidelines whenever you have out-of-state work:
- Always report out-of-state work. This provides you with rates, ensures the carrier can provide the coverage and also gives your carrier adequate time to secure local resources.
- Always keep track of out-of-state work. The premiums charged for states can be dramatically different, so ensure you have appropriate recordkeeping of where work is performed.
- Ensure employees are provided with the state mandated “posting notices” or other information (this is usually provided to you by the insurance carrier).
Finally, it’s important to note there are states where there’s a “monopolistic ”or “state fund” for workers’ comp. These states are North Dakota, Ohio, Washington, Wyoming, Puerto Rico and the U.S. Virgin Islands. These locales require you to buy workers’ comp coverage through their state program. In addition, you should add “stop gap” coverage to your current program for “employer’s liability” protection in those areas.
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