Kentucky Workers’ Compensation Insurance

Kentucky law requires any employer with one or more employees to obtain adequate workers’ compensation insurance coverage within ten days of hiring.

This requirement applies whether the employee(s) work full or part-time and must apply regardless of whether they are family members or independent contractors.

In Kentucky, there are two options for securing adequate employees’ coverage: purchasing policies through authorized private coverage providers or self-insuring through the Commonwealth’s Office of Workers’ Claims (OWC).

It is important to note that opting for self-insurance requires meeting specific qualifications, such as those pertaining to the number of employees hired.

Covered benefits include medical expenses and lost wages; however, coverage levels may vary according to the employer’s size, scope of work, industry classification, and whether or not there are union members.

Penalties for non-compliance in Kentucky can reach up to $1,000 per employee without proper insurance during the time a worker was employed with no coverage.

For example, if during three years of employing ten people, a company failed to provide workers’ compensation insurance coverage for one full year. Failure to meet statutory requirements could result in a fine of up to $30,000 plus interest penalties.

It is vital for employers with operations in the state of Kentucky to comply with the state regulations regarding workers’ compensation insurance claims. 

Understanding these requirements protects both employees and business owners from unnecessary legal hurdles and financial losses.

Now let’s explore the insurance application process.

The application process for Kentucky workers’ compensation insurance can be quite lengthy but is necessary to obtain coverage. Employers need to identify authorized insurers that provide adequate coverage for their business operations and then submit an application outlining relevant details about their business operations including employment headcount, job role descriptions, safety measures in place, and risk control measures taken.

For instance, a construction company operating in Kentucky will need to showcase details such as building permits secured, size of the project site, types of equipment being used in construction, and how they’ll safeguard workers from falls or other mishaps on-site.

The insurer evaluates each application based on factors such as inherent risk, prior claims history, industry benchmarking data to determine pricing considerations. Post-evaluation; the insurer may provide recommendations to help mitigate any potential risk which may positively impact your rates.

Once suitable coverage has been determined, the employer must sign a policy contract issued by the authorized insurer and pay for the premium.

A certificate of insurance is then mailed to the employer certifying that their employees are covered under worker’s compensation insurance.

It’s crucial to note that certain employers may not be eligible for workers’ compensation insurance coverage with authorized insurers due to factors such as inadequate history of prior work experience, lack of sufficient safety procedures, etc. In such cases, an employer may have to reach out to other alternative programs.

Having understood the necessary steps required to acquire Kentucky workers’ compensation insurance, it’s important to choose a plan with adequate coverage at an affordable cost. 

Let’s explore factors involved in determining the cost implication of Kentucky worker’s compensation rates.