Workers’ compensation insurance for finance and accounting businesses

If a CPA suffers a slip-and-fall injury in the office, or your top tax preparer develops carpal tunnel, medical bills can pile up quickly. Workers’ compensation insurance can pay for an injured employee’s medical expenses and partial missed wages. It can also protect the employer if an employee files a lawsuit related to workplace negligence.

Workers’ compensation provides coverage in three primary areas:

• Employee injury and illness expenses
• Employee injury lawsuits
• Compliance with state laws

Workers’ compensation can help pay for an injured employee’s:

• Immediate medical costs, including ambulance ride and emergency room expenses
• Ongoing medical costs, such as medications and physical rehabilitation
• Partial lost wages while the employee is unable to work
• Death benefits, including funeral expenses, in fatal incidents

Employer’s liability insurance, which is typically included in a workers’ comp policy, provides protection when an employee decides to sue the owner of a tax preparation company, financial advice firm, or other company. Even if the employer is not at fault for the injury, an accusation of negligence could result in a costly legal battle.

Employer’s liability insurance can help cover:

• Attorney’s fees
• Court costs
• Settlements or judgments
• Witness fees

The amount you pay for workers’ compensation is a specific rate for every $100 of your payroll. Your premium is determined by the type of work done by your employees (classification rate), your experience modification rate (claims history), and payroll (per $100).

The formula providers use in underwriting to calculate workers' comp rates is:

Each state has its own unique set of laws for workers’ compensation requirements. Finance and accounting businesses in New York, for example, are required to carry workers’ compensation insurance for every employee, including part-time workers. Alabama businesses, on the other hand, are only required to carry workers’ compensation when they have five or more employees.

Independent contractors, sole proprietors, and partners aren't required to carry workers’ compensation insurance. However, it's still a good idea to carry this policy for financial protection against work injuries, which health insurance might not cover.

In certain states, finance and accounting businesses must purchase coverage through a monopolistic workers' comp state fund. Those states are:

• North Dakota
• Ohio
• Washington
• Wyoming

If you purchase workers’ comp through a monopolistic state fund, it might not include employer’s liability insurance. However, you can purchase it as stop gap coverage from a private insurance company.

Employees who only work in offices are still at risk of injury. In any workplace, an employee could slip on a wet floor or trip over equipment. An on-the-job injury can lead to an insurance claim – and a rise in your premium.

Business owners can manage risks by providing safety training and developing a safe work environment. For example, eliminating office clutter can reduce the risk of slip-and-fall injuries. Taking these steps could reduce workplace injuries along with insurance rates.

Workers’ compensation insurance offers protection for your employees and to some extent your business, but it doesn’t provide coverage for all risks. Finance and accounting business owners should also consider:

Professional liability insurance: This policy covers legal costs related to your work performance, such as a client who sues because your advice caused a financial loss. It's sometimes referred to as errors and omissions insurance (E&O).

General liability insurance: This policy covers common risks in the finance industry, such as customer slip-and-fall injuries and damage to client property.

Business owner's policy (BOP): A BOP combines general liability coverage with commercial property insurance at a discount to protect against common lawsuits and property damage.

Cyber liability insurance: This policy helps finance businesses recover from data breaches and cyberattacks. It's strongly recommended for any business that handles personal information.

Commercial auto insurance: This policy is required in most states for vehicles owned by a business. It covers costs if your work vehicle is involved in an accident.

Fidelity bonds: Also called employee dishonesty bonds, fidelity bonds compensate clients in the event of employee theft. They're often required by client contracts.

Are you ready to safeguard your small financial business with workers’ comp insurance? Complete Insureon’s easy online application to compare quotes from top U.S. carriers. Once you find a policy that fits your needs, you can begin coverage in less than 24 hours.