Ohio law requires every business with employees to provide workers’ compensation insurance purchased through a state agency.
The workers’ compensation system in Ohio is different than in most other states. It uses what is called a monopolistic state fund, which means that workers’ comp insurance can only be purchased through a government-operated fund – not through a private insurer. If a business also has employees outside of Ohio, it would need additional coverage to meet that state’s requirements.
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Any business that employs even one person in Ohio must carry workers’ compensation insurance. The exception is domestic workers, such as housekeepers, babysitters, and gardeners, who earn less than $160 per calendar quarter. If the worker is paid more than that amount during a 13-week period, then the employer is required to have workers’ comp coverage.
Volunteers are not required to be covered by workers’ comp insurance, unless their work is for a public employer, such as a volunteer firefighter or emergency medical technician.
An employer is required to carry workers’ compensation insurance in Ohio for part-time employees. However, if an injury occurs, the part-time employee’s benefits would be calculated according to a specific formula that takes into account how many hours the person usually works.
A sole proprietor or member of a partnership must carry workers’ compensation insurance for any employees of the business, but it is optional for the owners to have insurance for themselves.
It’s also crucial that an employer correctly classify individuals as either employees or independent contractors. The distinction is that someone is an employee if the employer manages working hours, materials, travel routes, and quality of performance. If that is the case, the business owner is required to provide workers’ comp coverage.
The Ohio Bureau of Workers’ Compensation (BWC) closely monitors and enforces workers’ compensation law. Ohio has strict penalties for businesses that fail to comply or that allow coverage to lapse.
It’s up to the BWC to set a premium for each employer every year. It will then send the employer a payment schedule. These premiums are based on a company’s estimated payroll, which is then re-evaluated each July and adjusted to reflect the actual payroll amount. Employers pay premiums directly to the BWC.
If a company allows coverage to lapse by not paying premiums, or if it does not submit a payroll report on time, penalties are assessed as follows:
If an accident occurs and a policy has lapsed, the employer can be sued by the injured worker for all damages and expenses or file a workers’ compensation claim. The Ohio BWC would then require that the employer reimburse it for the entire cost of the claim.
Estimated employer costs for workers’ compensation in Ohio are $0.75 per $100 in covered payroll, according to the National Academy of Social Insurance [PDF]. Ohio uses the NCCI manual to classify occupations by level of risk. When an employer reports its payroll to the BWC, it must include NCCI codes for the BWC to establish insurance coverage costs.
Ohio has a no-fault and exclusive insurance system for workers’ compensation. If an employee is hurt on the job, the person can receive workers’ compensation benefits for medical bills and a portion of lost wages. The employee does not need to prove that the employer caused the injury. In exchange for this guaranteed coverage, employees give up the right to sue the employer for negligence and they do not receive any money for pain and suffering, as they might in civil litigation.
It also means that any workers’ compensation claim in Ohio goes through the state BWC or Industrial Commission (IC). There are four workers’ compensation Ohio requirements that must be met to have a claim lead to a settlement:
Workers’ compensation death benefits in Ohio can be awarded to dependents – those who relied on the deceased worker for financial support. Dependents include:
There might be other family members who qualify as wholly or partially dependent, but that would be evaluated on a case-by-case basis.
Death benefits are 66.67% of the worker’s average weekly wage, within the state maximum and minimum, which changes annually. The BWC would decide how to allocate benefits among dependents. Generally, the spouse would receive benefits until he or she dies or remarries. Upon remarriage, the spouse would receive two years’ worth of benefits in a single lump sum.
The workers’ compensation death benefits also include up to $5,500 for burial expenses.
An employer can clear itself from further time and costs by participating in a workers’ compensation settlement. Ohio, like other states, accepts settlements as closure of a claim and the employee is not allowed to request additional benefits. Generally, a settlement is paid in a lump sum or a structured settlement, with the total sum paid out over time in increments.
A partial settlement could also be awarded to a claim, which is when the employee would settle disability and wage loss benefits but would retain the right to receive future medical treatment.
For both workers’ compensation death benefits in Ohio and regular benefits claims, the statute of limitations is one year from the time of injury or death.
If you are ready to explore business insurance options for your Ohio business, start a free online application today to compare quotes from multiple carriers.