Workers’ compensation insurance is required for every employee in Washington, including part-time workers. This is a monopolistic state, which means coverage must be purchased through the Washington state fund.
Washington is one of four monopolistic states, which also include Ohio, Wyoming, and North Dakota. A monopolistic state is one where you can only purchase workers’ compensation insurance from a state fund, and not through a private insurer. In Washington state, workers’ comp is administered through the Washington State Department of Labor & Industries (L&I).
Each business must have a business license and an account with L&I to purchase workers’ comp insurance through the fund. L&I will make classifications based on its own system, which determines coverage rates.
If a business or employer has $25 million or more in assets and an accident-prevention program, it might be permitted to get self-insurance.
Small businesses can still purchase other insurance policies through private insurers, including common coverages such as general liability insurance, professional liability insurance (also called errors and omissions insurance or E&O), and cyber liability insurance.
Workers’ compensation insurance is required in Washington state for any business with one or more employees. If you have any employees – even independent contractors – you might be required to buy coverage.
Washington state law requires workers’ compensation insurance for both full- and part-time employees.
However, there are circumstances in which a worker would be exempt from the state's workers’ compensation requirements:
For details and a full list of exemptions, check the DLI Employers' Guide to Workers' Compensation [PDF].
A sole proprietor usually does not need workers’ compensation. The business owner, who could be a member of an LLC, corporate officer, or a partner in a partnership, would not be required to carry this insurance. There are options available for an owner or sole proprietor who would like to elect coverage.
Workers’ compensation benefits can cover medical and hospital expenses resulting from a workplace injury. It can also cover partial wage replacement if the employee is unable to work, or is delegated to light duty because of an impairment.
Workers’ compensation insurance in Washington state can include coverage for:
Injured employees can visit a medical provider of their choice for emergency treatment, but must see an authorized provider for follow-up care.
The State of Washington recently increased its penalties for noncompliance with its workers' compensation laws. Penalties include:
For details, visit the Washington State Legislature.
An eligible survivor can receive a one-time benefit plus a monthly survivor’s pension if a family member dies as a result of a work-related injury or illness. The spouse of the deceased worker is automatically eligible for death benefits. The worker’s children are eligible if they are legally dependent.
Washington's workers’ compensation system also covers funeral benefits up to two times the state's average monthly wage.
Workers’ compensation settlements are agreements between the injured worker, employer, and the insurer to resolve a claim. Most workers’ comp claims in Washington become a structured settlement, which means the injured worker receives periodic payments in installments over time.
Acceptance of a structured settlement would prevent the worker from claiming future benefits for wage loss and permanent disability, but it would not prevent claims for future medical treatment. If a new injury or illness related to the original claim is diagnosed or discovered later, the claim could be reopened.
In Washington state, the workers’ compensation statute of limitations is one year from the date of injury. If the worker has an occupational disease, the statute of limitations is two years from the date it was discovered.
If you’re ready to explore commercial insurance coverage for your Washington business, start a free online application with Insureon today to compare quotes from top-rated insurers.