Ohio's Workers' Compensation Insurance Law

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Workers’ compensation insurance requirements in Ohio

The workers’ compensation system in Ohio is different than in most other states. Ohio law requires every business with employees to provide workers’ compensation insurance purchased through a state agency.

Ohio 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.

Small business insurance policies, including general liability, professional liability, and numerous other coverage types, are available at competitive rates in the open market in Ohio. Start a free online application with Insureon to compare quotes from leading insurers today.

Who needs workers’ comp insurance in Ohio?

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.

Is workers’ comp mandatory in Ohio for part-time employees?

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.

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

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.

 

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

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:

  • Failure to file a payroll report on time is 1 percent of the premium due ($3 minimum to $15 maximum).
  • Failure to pay a premium on time would result in a $30 flat fee, along with a charge of up to 15 percent of the premium due, depending on how late it is received.
  • The BWC would file assessment liens for nonpayment of premiums and claim costs when there is a lapse in coverage.

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.

 

What is the average cost for workers’ compensation insurance in Ohio?

The average cost for workers’ compensation insurance in Ohio is $0.75 per $100 in wages. 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.

 

How workers’ compensation works in Ohio

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:

  • There must be an employer / employee relationship that establishes that the individual was rightfully entitled to benefits and was not an independent contractor.
  • The injury was “accidental in character and result,” which means that an employee must have been following workplace protocol and procedure and was not failing to follow rules, lacking common sense, or inattentive when the injury occurred.
  • The injury was in the course of employment, which essentially means that it happened on the job.
  • The injury arose out of the employment, which means that the injury was caused by a risk or hazard directly related to employment. Often, when the issue is something like toxic exposure, repetitive motion injuries, or similar, there can be disputes as to whether the job and work environment directly led to the injury.

Workers’ compensation death benefits in Ohio

Workers’ compensation death benefits in Ohio can be awarded to dependents – those who relied on the deceased worker for financial support. Dependents include:

  • A spouse
  • A child under 18
  • A child under 25 who is a full-time student
  • A disabled child of any age who cannot earn a living

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 and two-thirds percent 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.

 

Workers’ comp settlements in Ohio

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.

Workers’ compensation statute of limitations in Ohio

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.

 

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Workers' compensation insurance: Further reading

See workers' comp laws where you live