Workers' Compensation coverage is optional for employers in Texas. The exception is for construction companies that contract for governmental entities—in this instance, insurance is required. Even under Texas' lax Workers' Comp regulations, workers have the legal right to file compensation claims if they think they have a genuine case and their employer refuses to pay benefits.
TX Workers' Comp: Key Details
- Sole proprietors, partners, corporate officers, and LLC members in Texas are automatically included in coverage, but can elect to opt out of covering themselves with their policy.
- If you do not carry Workers' Compensation Insurance coverage, you are considered a "non-subscriber." This means you must notify your employees and the Division of Workers' Compensation that you do not carry Workers' Compensation Insurance.
- In Texas, employers are allowed to negotiate with their insurance company for a lower experience modifier (the adjustment of annual premium based on previous loss experience).
- The state Workers' Comp fund for Texas is Texas Mutual Insurance Company.
- Coverage can be purchased through the fund, a private insurer, or through self-insurance (for qualifying businesses).
Need more details about Texas' unusual Workers' Comp laws? Check out resources from the Texas Department of Insurance.