Workers’ Compensation Insurance in Louisiana
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Louisiana workers' compensation insurance

The Louisiana workers’ compensation law requires employers to carry insurance for every employee. This insurance policy covers medical expenses for workers who are injured on the job.

Who needs workers’ comp insurance in Louisiana?

Every employer in Louisiana is required to carry workers’ compensation insurance or must be approved for self-insurance. Any employee who is full- or part-time, including seasonal staff and minors, must be covered.

The few exemptions to this are domestic employees, real estate salespeople, some people who volunteer for nonprofit organizations, certain musicians and performers, some public officials, and those covered under federal laws, such as railroad workers.

You may be required to provide coverage if you hire uninsured contractors or subcontractors to perform work which is a part of your trade or business. The state also offers an online test to determine whether a contractor should be considered an employee and entitled to workers’ compensation coverage.

Do you need workers’ compensation insurance in Louisiana if you are self-employed?

If a business is owned by a sole proprietor or independent contractor who has no employees, the owner does not need to carry workers’ compensation. This would also be the case if it’s a partnership with co-owners and no employees.

Because of the high cost of medical bills, sole proprietors who work in high-risk industries should consider buying workers' comp coverage even when it's not required by law.

How much does workers' compensation insurance cost in Louisiana?

A small business owner calculating their workers' comp insurance payments

The average cost of workers’ compensation in Louisiana is $59 per month.

Your workers' comp premium is calculated based on a few factors, including:

  • Payroll
  • Location
  • Number of employees
  • Industry and risk factors
  • Coverage limits
  • Claims history

How do you buy workers' compensation insurance in Louisiana?

Employers in Louisiana have a few options when it comes to buying workers' comp insurance:

You can purchase workers' comp from a private insurer. Insureon's easy online application lets you compare quotes from top-rated insurance companies.

You can apply for self-insurance. To self-insure, employers must meet requirements and fill out an application [PDF] with the Louisiana Office of Workers' Compensation Administration.

You can purchase workers' comp from the state fund. Louisiana operates a competitive state fund operated by the Louisiana Workers’ Compensation Corporation (LWCC).

How can Louisiana business owners save money on workers' comp?

To save money on workers' comp insurance, it's important to make sure you classify your employees correctly. Employees with desk jobs or other jobs with a low risk of injury cost less to insure. This also helps you avoid misclassification fines.

In some cases, small business owners can choose to buy pay-as-you-go workers' compensation. This type of workers' comp policy has a low upfront premium, and lets you make payments based on your actual payroll instead of estimated payroll. It's useful for businesses that hire seasonal help or have fluctuating numbers of employees.

Finally, a documented safety program can help lower workers' comp costs. A safer workplace means fewer accidents, which helps keep your premium low.

How does workers' compensation work in Louisiana?

Workers' compensation insurance covers the cost of medical treatment when an employee is injured on the job or develops an occupational disease. It also provides partial lost wages during the injured employee's recovery.

Policies usually include employer's liability insurance, which helps 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.

In Louisiana, workers' compensation benefits include:

  • Medical benefits (surgery, prescriptions, physical therapy, and other medical care)
  • Permanent partial disability benefits (for conditions such as amputation)
  • Permanent total disability benefits (the employee must prove they cannot work)
  • Temporary total disability benefits (usually two-thirds of the average weekly wage)
  • Catastrophic injury benefits
  • Vocational rehabilitation
  • Death benefits

Injured workers become eligible for supplemental earnings benefits if they cannot return to work and earn at least 90% of their former wage.

What are the penalties for not having workers’ comp insurance in Louisiana?

Louisiana employers that fail to carry workers’ compensation insurance could be fined up to $250 per employee for the first violation and $500 per employee for each subsequent violation, up to a $10,000 maximum.

An employer can also be charged with a criminal violation for willfully failing to provide workers’ compensation insurance or for providing false information to the Louisiana Workforce Commission, the entity that oversees workers’ compensation insurance in Louisiana.

The employer could also be served an injunction requiring that it stop doing business until the correct workers’ compensation policies are obtained.

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Workers’ compensation death benefits in Louisiana

If an employee dies as the result of a work-related injury, the State of Louisiana presumes that the surviving spouse and children are dependent and entitled to benefits. There are a few conditions:

  • The surviving spouse must be living with the worker at the time of death.
  • For children to be eligible dependents, they must have lived with the worker at the time of death, are under age 18, or are physically or mentally incapacitated and unable to earn a living.
  • Children must be under the age of 23 and full-time students.

Other family members who were financially dependent on the deceased worker might be eligible for Louisiana workers’ compensation death benefits if they are living in the deceased worker’s household. Unmarried partners are ineligible unless they’re receiving benefits on behalf of shared children.

The maximum compensation is $665 per week in 2019:

  • The surviving spouse can receive 32.5% of the deceased worker’s average weekly wage.
  • A surviving spouse and one child can receive 46.25%.
  • A surviving spouse and two or more children can receive 65%.
  • A surviving child can receive 32.5% if there is no spouse, two children would share 46.25%, and three or more children would receive 65%.
  • A dependent parent can receive 32.5% if there is no spouse and no children, and two dependent parents could receive 65%.
  • If there is no spouse, children, or parents, a dependent sibling could receive 32.5%, with 11% for each additional sibling up to 65%.

If there are no dependents, adult children receive $75,000 divided among them.

Workers’ compensation insurance also provides for burial and funeral expenses up to $8,500.

Louisiana workers’ comp settlements

If a workers’ compensation settlement is reached, in most cases, the insurer will pay the injured worker a lump sum. Once a settlement is agreed upon, it includes disability benefits and medical coverage, and the worker can no longer make claims against the insurance company or the employer related to that accident or injury.

If a worker is already receiving workers’ compensation benefits, they can get a commutation, which means the weekly benefits could be added up and discounted to the present value (reduced by up to 8% per year), and then paid out as a lump sum. This avoids a full and final settlement.

The workers’ compensation laws in Louisiana encourage benefits to be paid on an ongoing basis rather than as a lump-sum payment.

Workers’ compensation statute of limitations in Louisiana

Louisiana workers’ compensation claims must be filed within one year of the date of injury, or one year from the date that a disability was diagnosed. It can be no longer than two years following the date of the accident or injury.

The employer must report injuries with a First Report of Injury or Illness form within 10 days of knowing of an injury or illness resulting in more than one week of lost time.

Workers' comp claims disputes are mediated by the Office of Workers' Compensation.

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Start a free online application today to compare workers’ compensation insurance quotes from leading U.S. carriers for your small business. Insureon’s licensed agents specialize in insurance for a variety of Louisiana businesses.

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Updated: February 6, 2024

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