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Texas Workers’ Compensation insurance

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Is workers’ compensation insurance required in Texas?

Unlike most other states, Texas does not require businesses to have workers’ compensation insurance. That might sound like a good deal for your business, but not having coverage also means that you could be held responsible for expenses if you or an employee gets hurt on the job.

If you consider the potential out-of-pocket expenses for an injury vs. the cost of workers’ comp in Texas, you might find that it’s a worthwhile investment. If you or an employee is injured on the job, a workers’ comp policy can help pay for:

  • Emergency treatment
  • Medical bills
  • Lost wages
  • Death benefits

Keep in mind, while state law in Texas does not require workers’ compensation, it might be required by the city where you work or for certain business licenses and certifications. 

Your clients might also ask for proof of coverage before signing a contract to work with you, so it’s good to be prepared. 

Start a free online instant quote to explore options for your business or continue reading to learn more. Next Insurance offers a painless and seamless way to explore coverage and cost options for thousands of different types of businesses in about 10 minutes. Our Texas-based insurance advisors are standing by to help you throughout the process.

 

Businesses that work with state agencies need workers’ compensation

If your company plans to work with government agencies, you’ll most likely need to have workers’ comp in Texas. It’s required for:

  • Contractors or vendors with any public employer, such as city, county and state agencies
  • State universities
  • Building and construction contractors for public employers
  • Buses and companies that provide transportation on public highways
  • Liquid propane gas and compressed natural gas dealers
  • Businesses that employ inmates in work furlough programs

How does workers’ compensation work in Texas?

Workers’ comp can help pay for expenses related to work-related injuries. In the event of a work-related death, it also covers death and burial costs up to the coverage limits. 

Typically, workers’ compensation coverage includes medical expenses, loss of income, retraining, permanent injury and survivor benefits up to the policy limit.

Workers’ compensation does not cover incidents that are not job-related or situations when the injured person violates company policies, commits misconduct, or uses drugs or alcohol.

 

Workers’ comp income benefits in Texas

Income benefits with workers’ compensation in Texas include one of four options with a maximum annual amount that is determined by the Texas Workforce Commission:

Temporary income: 70% of the insured’s average weekly wage 

Impairment income: 70% of the insured’s average weekly wage 

Supplemental income: 80% of the insured’s average weekly wage 

Lifetime income: 75% of the insured’s average weekly wage 

 

What are the risks of not having workers’ comp coverage?

Under Texas workers’ compensation law, if your company does not provide workers’ compensation insurance, employees can file a lawsuit to recover medical expenses or lost wages after a workplace injury. 

For example, if one of your employees falls off a ladder and injures his back, your workers’ compensation insurance could provide coverage. If you don’t have an active policy, your employee could take legal action and ask you to pay for medical expenses, which could result in significant long-term financial losses. 

How much does workers’ comp insurance cost in Texas?

Because the risk of a job-related injury is greater for certain professions, workers’ compensation costs vary across industries. Other factors that influence price include:

  • The number of employees and the type of work they do
  • Your insurance claims history
  • The locations where you do business

Next insurance offers workers’ compensation insurance that is designed to meet the needs of thousands of different businesses in Texas. 

Start a free instant quote online to see how much coverage will cost for your business. You’ll just need to answer a few questions to get a quote in about 10 minutes.

What types of businesses buy workers’ comp in Texas?

Almost every type of business in Texas can benefit from the financial protection offered by workers’ compensation insurance. 

Many general contractor and construction businesses purchase coverage with Next Insurance because a certificate of insurance is often required to get a general contractor license in Texas cities. Construction businesses also typically have a greater risk of workplace injuries than other types of businesses. 

However, professional services, consultants and other businesses with a lower risk of workplace injuries also opt for coverage. That’s because accidents that cause injuries can happen anywhere — even at desk jobs. 

Many clients and professional organizations, regardless of the industry, might also ask you to provide a certificate of insurance for workers’ comp before they’ll do business with you.

Workers’ compensation death benefits in Texas

In the unfortunate event of the death of an employee, workers’ compensation provides 75% of the deceased worker’s average weekly wage, up to an amount that changes yearly and is provided by the state. 

These benefits are available to eligible family members who fall into the following categories: 

  • Spouse
  • Child under 18 or under 25 if a full-time student
  • Child of any age who was dependent on the worker at the time of the worker’s death
  • Grandchild who was at least 20% dependent, if the child’s parent is not eligible for death benefits
  • Other family members who relied on the worker for financial support, if none of the above are applicable

It also covers burial expenses up to $10,000 and any transportation costs if the death occurred away from the usual place of employment.

How Next Insurance helps Texas businesses find the right workers’ comp coverage

Next Insurance offers workers’ compensation insurance designed for small businesses and self-employed workers. 

With our online services, you can get a quote, review coverage options, purchase insurance and have your certificate of insurance in about 10 minutes. 

Start an instant quote online today.

If you need some help during the process, our team of licensed Next Insurance advisors is standing by to assist you.

Other business insurance policies that are important in Texas

Workers’ compensation insurance provides many important protections, but you’ll need to include additional coverage with your business insurance package to make sure you are protected from all the risks you face every day. 

Most Texas businesses also consider these options:

General liability insurance

General liability insurance protects your business from common mistakes or accidents that can occur in your industry, such as customer injury or damages to someone’s property. 

Professional liability insurance (a.k.a. E&O insurance)

Professional liability insurance provides financial protection against claims of professional mistakes and negligence. 

Commercial auto insurance

In Texas, all business-owned vehicles must be covered by commercial auto insurance. If you’re driving and using your personal vehicle for work-related purposes, commercial auto insurance also protects your business from unexpected expenses if you are involved in an accident. 

FAQ

How do I get a Certificate of Insurance?
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We provide you unlimited certificates of insurance, free of charge. Once you've purchased a policy, log in to our website to get proof of insurance or add an Additional Insured. In most cases, you'll get your certificate within minutes. Otherwise, we'll email it within one business day.
Can I add to or change my coverage?
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If you’ve expanded your business and need coverage for more kinds of work, please let us know! An agent will go over your new operations and next steps with you and in most cases, we’ll be able to set you up with a new policy on the same day (so there will be no gaps in your coverage). Unfortunately though, we can’t remove any exclusions from the policy. So if you see your operations listed in our exclusions section, we’re very sorry, but our policy isn’t going to be the right fit for you just yet.
How does Live Certificate work?
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When you login to your account at the Next Insurance website, you’ll see an option to “Share Proof”. Clicking that will give you an option to either put in an email address and have us send your certificate, or copy a link which you can send to anyone you like that will take them to your Live Certificate.
How long will it take to get my policy after I buy?
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You will be receive your policy documents via email within one business day of purchase.
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