The workers’ compensation system was actually born out of a New York state tragedy: the worst factory fire in New York City’s history, at the Triangle Shirtwaist Factory in 1911. Today, the state upholds strict requirements for employers. All New York businesses with employees (full- or part-time) must carry workers’ compensation insurance.

As of 2007, any out-of-state businesses with employees working in New York state must also have a fully compliant workers’ compensation insurance policy.

Small Business Work Comp Requirements in New York

New York employers are required to provide workers’ compensation insurance for:

• The employees of any for-profit business. This includes part-time employees, borrowed or leased employees, family members and volunteers. (Most non-profit employees must also be covered.)
• Domestic workers employed 40 hours or more.
• Farm workers paid $1,200 or more over 12 months.

Business Owners: Sole proprietors, partners and one- and two-person corporations do not have to carry coverage, but may include themselves on a policy.

Contractors: A worker under direct control of the employer may be considered an employee, regardless of their tax status.

How to Buy Small Business Workers’ Compensation Insurance

New York has a private market. You can purchase a workers’ compensation policy from any private insurance carrier or agency that is licensed to write in that state.

New York also has a state fund that competes with the private market. You can contact the New York State Insurance Fund if you are unable to secure coverage from a private insurance carrier. State funds accept higher-risk businesses, and their rates are often higher. Large employers might consider self-insurance options.

Coverage and Rates in New York

The state upholds harsh penalties for workers’ compensation violations. Not carrying workers’ compensation insurance for more than five employees is a felony in New York state, and penalized businesses can be debarred from public work contracts.

Keep in mind that your policy covers employees only when they are working in-state; additional coverage might be needed for out-of-state work.

New York has an office dedicated to answering workers’ compensation questions, particularly for small business owners. The Advocate of Business is the liaison between businesses and the state work comp systems, and can help with coverage and compliance issues.

While most states use the National Council on Compensation Insurance (NCCI) to collect workplace data and set rates, New York uses its own rating bureau, the New York Compensation Insurance Rating Board. This non-profit, unincorporated association of insurance carriers collects loss, premium and payroll data, and recommends rates. Rates are set by class code, or industry.

This base rate is multiplied by company payroll, and then Experience Modifier and other discounts may be applied by an insurance carrier to calculate the final premium. The rating bureau also sets Experience Modifier factors for employers with premiums above $5,000.

New York Work Comp Resources

• Workers’ compensation regulation: New York Workers’ Compensation Board
• Rating bureau: New York Compensation Insurance Rating Board
• State fund: New York State Insurance Fund
• Advocate of Business office

Here’s What You Need to Get Started

To buy workers compensation insurance, you need to request a quote from a licensed insurance agent and provide some details about your business.

Here’s what to have in front of you:

• Number of employees in each class code.
• Total payroll for all employees. You may be able to exclude yourself if you don’t wish to be covered under the policy.
• Federal ID Number. If you are a sole proprietor, you can use your Social Security Number.
• Copy of your workers comp insurance policy, if you’ve had coverage or claims in the past few years. If you know your company’s experience mod, please have your experience mod rating sheet or policy in front of you. Otherwise, you will be assigned a default rating of 1.0.

The information on this page has been interpreted and summarized for your convenience. Please consult your state’s governing authority for the most current and complete legislation.

Other Tips

If you employ workers in multiple states or your employees are temporarily working out-of-state, you need to purchase insurance for all the states where your workers are located, according to each state’s laws.

Call 704-341-2650 and let us walk you through it.

The nature of your business, number of employees being covered and past coverage and claims are all factors in how much your premium will cost.