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Colorado state law requires businesses with at least one employee and anyone who works on a construction site to have workers’ compensation insurance. However, there are a few exceptions to this general requirement, which will explain below.
Regardless of how many employees you have, workers’ compensation insurance provides important financial protection for business owners and their employees if there is a workplace accident. If you don’t have any coverage — or if you have a lapse in your insurance — your business could be responsible for significant medical expenses and you could face penalties from the state.
If you or one of your employees are injured while working, Colorado workers’ compensation coverage can help pay for:
In addition to maintaining active workers’ comp coverage for businesses with employees, the Colorado Division of Workers’ Compensation also has a few additional requirements for employers:
In Colorado, with limited exceptions, construction workers’ are required to have workers’ compensation insurance. Construction business owners working on a construction site are required to have coverage for themselves. They must also provide workers’ compensation insurance if they hire independent contractors that do not have their own coverage.
Businesses can prove they have coverage with a certificate of insurance (COI) form.
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Sole proprietors and independent contractors who do not work in construction are not required to have workers’ compensation coverage.
However, independent contractors must sign and notarize a workers’ compensation waiver in Colorado and provide it to any companies they choose to work with as proof of exemption.
Additionally, under certain circumstances, business partners, corporate officers or members of a limited liability company (LLC) might not have to have coverage.
There are several other exemptions for specific business types, including:
Regardless of the industry, virtually every type of business can benefit from workers’ compensation coverage, even independent contractors.
Accidents can happen anywhere, from a construction site to a coffee shop. That’s why many employers who tend to have a lower risk of accidents at work still have coverage.
For example, your employee with a desk job could slip and fall in a wet entryway or develop carpal tunnel syndrome. If you don’t have coverage, you could be responsible for medical expenses related to those accidents or injuries.
More than 20,000 workers’ compensation claims are filed in Colorado in any given year, According to the Department of Labor.
Coverage provides an essential safeguard for you and your employees if there is a workplace accident, and it can help ease the financial burden on your company if there is a work-related injury.
For example, you own an HVAC business with a handful of employees. One day, one of your employees slips and twists his knee. Once he visits the hospital, it turns out he’s torn a ligament and won’t be able to work for two months and he files a claim. Through your workers’ compensation insurance, your coverage can help pay your worker’s medical expenses and lost wages up to your policy limit.
Workers’ comp benefits can equal up to two-thirds of the average weekly wage they were receiving on the date of the injury, up to a maximum amount set by the state.
If an employee dies on the job, Colorado workers’ compensation laws allow the deceased’s dependents to receive death benefits. The amount is calculated at approximately two-thirds of the workers’ average weekly wages at the time of death. The state sets a maximum amount which changes on a yearly basis.
The Division of Workers’ Compensation in Colorado classifies dependents as:
You might be curious about how much is workers’ compensation in Colorado? The answer varies.
The risk of a job-related injury is different for every industry, which can be a factor in determining costs. Each business also has different employees who face different risks. For example, a receptionist is not as likely to get injured as an inspector who is out in the field every day.
There are a few other factors that can influence the price of workers’ comp coverage, including:
Next Insurance can help you figure out your coverage needs no matter what type of business you own. Our streamlined process allows you to get a quote, buy the coverage you need and get a certificate of insurance in about 10 minutes.
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While workers’ compensation insurance is an important requirement for businesses in Colorado, there are other types of insurance you might want to consider too.
General liability insurance helps protect your business from common accidents or mistakes that can happen in your industry. Examples include property damage or injury to a customer.
Professional liability insurance helps provide coverage against financial claims of professional negligence or mistakes.
In Colorado, there are a variety of requirements for commercial auto insurance. If you are using your company vehicles to carry property or people, you will need to comply with specific coverage requirements. This coverage can help cover some expenses if you are involved in an accident.