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Self-employment can give you a large amount of freedom, but it also brings up a lot of tricky questions. One awkward question is do you need workers’ comp as a single, self-employed entrepreneur?
Workers’ comp insurance for self-employed workers’ may feel like a bit of a waste, but there are a lot of facts you need to check before writing it off. It may save you a lot of money and headaches.
Today we’ll go over what you need to know so you can make a firm decision.
Understanding Workers’ Comp Insurance For Self-Employed Entrepreneurs
Whether workers’ comp for self-employed people like you is worth it depends on a few factors. Consider these five concepts to get a better grasp on the situation.
1. Consider Your Risk Environment
Not every self-employment job is the same. Workers’ comp insurance bases the standard rate off of the occupation. They have a set system to determine that works with the basic job description.
This means that anything that would classify as an office worker is a much lower risk than a construction contractor.
Taking this in will determine how much you may need the insurance regardless of other factors.
2. Understanding Your State Requirements
The requirements of the state you work in have a huge say in your workers’ comp insurance.
It is different from state to state, so make sure to check your own state’s requirements. In some states, workers’ comp is not optional even for self-employed solo workers’.
Some states also dictate where you can get your insurance. These states will often have a state-run fund for it.
3. Health Insurance Vs Workers’ Comp
Some entrepreneurs may consider relying on their health insurance to cover any workplace accidents. This is a trap!
Most health insurance policies do not cover workplace accidents. They assume your employer has workers’ comp insurance. This means if you have a need or requirement for workplace protection, health insurance won’t cut it.
4. Finding Appropriate Doctors For Workers’ Comp
Workers’ comp insurance also has an impact on the doctors that you may see. While many doctors work within workers’ comp restrictions and can function fine in this situation, it is important to double-check.
Looking for a doctor and want to make sure they fall in line with workers’ comp restrictions? The search engine through workers comp doctor is a powerful tool to help find the right fit.
5. Future Need For Workers’ Comp Insurance
For the moment, all of this is in consideration that you are a self-employed entrepreneur that has no other employees. For now, all of the above is what you have to worry about, but a smart entrepreneur will think toward the future.
First, when you want to expand your business and hire employees, then workers’ comp insurance becomes an absolute need. Planning out those costs will be important.
Second, hiring independent contractors to operate as employees is not a good way to avoid workers’ comp insurance. Some states even hold the business owner responsible despite a mistake from the independent contractors.
Keeping Your Business Healthy and Happy
Now that you have a better grip on the issues surrounding workers’ comp insurance for self-employed entrepreneurs like yourself, you can keep pushing your business with a secure mind that accidents can’t bring you down.
One issue down, but many more to go, there is a lot you can learn to build a better business. From marketing to interviews, we have the information you need to succeed. Check out our other articles today.
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