Hawaii law requires every business with employees to carry workers’ compensation insurance. This policy provides medical benefits for employees who are injured on the job.
However, there are several exemptions to Hawaii’s requirements for workers’ comp. Certain business owners, officers, and executives can opt out of coverage, including:
Members of limited liability companies (LLCs) are also exempt from workers’ compensation as long as they are a person (and not a business entity) and would stand to receive at least 50% of the LLC’s value if the firm were liquidated or sold.
Even when it's not required, you should still consider carrying workers' comp coverage. It's usually a wise decision, as personal health insurance plans exclude coverage for work-related injuries.
Certain employees are also exempt from workers’ comp coverage, including:
Employers may decide to voluntarily cover excluded employees, which makes sense given the potential cost of medical bills from a work injury.
Workers' compensation insurance covers the cost of medical treatment when an employee is injured on the job. It also provides disability benefits while the employee recovers.
Policies usually include employer's liability insurance, which can help cover legal expenses if an employee blames their employer for an injury. However, the exclusive remedy provision in most workers' comp policies prohibits an employee from suing their employer if they accept workers' comp benefits.
Workers' compensation benefits can cover:
Explore the State of Hawaii's Disability Compensation Division's FAQs for details.
Hawaii business owners can compare quotes and purchase a policy from private insurance companies. (Insureon offers this service with its online insurance marketplace.) If they’re unable to qualify, they can buy it from the Hawaii Employers’ Mutual Insurance Company (HEMIC), the state’s workers’ compensation insurer of last resort.
Eligible employers can also choose to self-insure their workers’ compensation claims. This means they’ll cover their own workers’ comp medical and rehabilitation expenses rather than submit them to an insurance carrier.
If an employer violates the Hawaii workers’ compensation law, it will be liable for fines and penalties of up to $100 per employee per day. Companies that fail to provide workers’ comp protection also leave themselves open to employee lawsuits to recover benefits that should have been paid.
If an employee dies as a result of a work-related injury or illness, surviving dependents are eligible to receive death benefits.
In Hawaii, any family member who was financially dependent on the deceased worker can receive cash payments. This includes:
In Hawaii, the amount of a workers’ comp death benefit depends on which family members are applying for benefits. The total benefits paid for all family members can’t exceed two-thirds of the injured worker’s average weekly wages.
Death benefits in Hawaii end when a spouse passes away or gets remarried. When a spouse decides to remarry, the person can apply for a lump sum equal to two years of workers’ compensation benefits.
Hawaii workers’ compensation also provides funds toward payment of funeral costs.
In Hawaii, workers who get sick or injured on the job often agree to a workers’ compensation settlement. This is a voluntary agreement between the employee and the employer to close out the case in return for the worker receiving a lump-sum payment. A settlement resolves a workers’ compensation claim fully and permanently.
Every Hawaii workers’ compensation settlement must be approved by the Disability Compensation Division (DCD).
The statute of limitations for a Hawaii workers’ compensation claim is two years from the date at which an injury becomes apparent and five years from the date the accident caused the injury.
Start a free online application today to compare workers’ compensation insurance quotes for your business from leading U.S. providers. Insureon’s licensed agents specialize in insurance for numerous Hawaii businesses.