Kentucky Workers’ Compensation Insurance

You can save up to 25% in discounts on business insurance.*

Workers’ Compensation can help pay for:

Medical expenses

Medical expenses

Includes examinations, treatments and rehabilitation.

Lost wages

Lost wages

Gives employees time to recover from an injury before returning to work.



Helps employees who need to learn skills and enter a new field.

Permanent injury

Permanent injury

Provides benefits for employees who can no longer work due to injury.

Is Workers’ Compensation insurance required in Kentucky?

Workers’ compensation insurance is required for all Kentucky employers with one or more employees. In this state, executive officers of corporations are also considered to be employees.1

In KY, workers’ comp helps business owners and employees alike. It protects employers against some unexpected costs while also helping to cover expenses for injured workers. Some of the key benefits provided by workers’ compensation insurance include:

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

Who is exempt from Workers’ Compensation insurance in Kentucky?

There are certain types of employees who are considered exempt from Kentucky’s workers’ comp requirement. These employees include:

  • Agriculture employees
  • Domestic servants in a home with less than two employees who work less than 40 hours per week
  • Professionals employed to do maintenance, repair or remodeling work in a private home for no more than 20 consecutive work days
  • Individuals performing services in return for aid or sustenance from a religious or charitable organization
  • Voluntary carpool drivers
  • Certain religious organizations

Employees in Kentucky also have the option to willingly sign forms which forfeit their rights to workers’ compensation benefits. For example, a corporate officer may choose to reject their coverage.2

Workers’ Compensation owners coverage

Kentucky workers’ compensation laws state that business owners may elect to be included as employees. These types of business owners include:

  • Sole proprietors
  • Partners in a partnership
  • Limited liability company members

Regardless of whether they choose to extend workers’ comp coverage for themselves, these business owners are still required to have coverage for any employees they may have.3

Extending coverage to business owners is often a smart move financially.

For example, if you own an appliance repair business and you injure your back while moving an oven, you may rack up medical bills as the result of your injury and miss out on income during your recovery time. If you have workers’ comp insurance, it could help cover the costs of your medical care and lost wages.

Self-insurance for Kentucky Workers’ Compensation

Kentucky employers may be eligible to self-insure their company for workers’ compensation rather than obtaining an insurance policy. The application requirements for becoming self-insured include:

  • Proof of assets of at least $10 million
  • Certified, audited financial statements for the last three years
  • Posted security for a minimum of $500,000
  • Excess insurance with a minimum coverage limit of $10 million per occurrence

How does Workers’ Comp work in Kentucky?

Workers’ compensation insurance provides coverage for expenses related to injuries that occur on the job, such as:

  • Medical expenses
  • Loss of wages
  • Temporary or permanent disability
  • Survivor benefits

For example, if one of your restaurant employees gets burned while working in the kitchen, workers’ compensation insurance could help pay for the costs of their medical care as well as the lost income until they can return to work.

Workers’ Compensation income benefits in Kentucky

There are certain income benefits tied to workers’ comp. Kentucky policies generally cover the following categories for income benefits:4

Temporary total disability

These benefits are paid to an employee whose physician states that they are unable to return to some type of work for more than seven calendar days.

Permanent partial disability

This type of income benefit may be paid to employees who, despite reaching maximum medical improvement, still have a permanent impairment that affects their potential wage earning capacity.

Permanent total disability

These benefits are reserved for employees whose injuries result in a complete and permanent inability to perform any type of work.

Death benefits are also available if an employee dies within four years of the date of injury and as a direct result of the injury. This includes a lump sum payment to the employee’s estate for covering burial expenses as well as income benefits for a surviving spouse and certain dependents.

Employer responsibilities for Workers’ Compensation insurance

Employers who must have insurance according to KY workers’ comp laws are also required to post a notice in a conspicuous location in the workplace. This notice informs employees of their rights, provides directions on how to obtain assistance and includes specific details about the employer’s insurance carrier.5

Kentucky Workers’ Compensation insurance reciprocity

Under certain conditions, a Kentucky workers’ compensation insurance policy will provide coverage for work injuries that occur outside of the state. Generally, if the workers’ employment is primarily located within Kentucky, but they occasionally travel for specific work purposes, the same coverage will apply.

Business owners with employees who regularly work out of state should check with their insurance carrier to verify whether coverage extends to employees while outside Kentucky.

Are there penalties for not having Workers’ Comp coverage?

Employers who fail to obtain the required workers’ compensation coverage are subject to a fine of $100 to $1,000 per employee. These fines can add up quickly since each employee and each day of non-compliance constitutes a separate offense.

If an employee gets injured on the job while the employer does not have coverage, the employer can also be held liable for benefits the worker would otherwise receive through workers’ comp, including medical expenses and lost wages.

What are the rates for Workers’ Compensation in Kentucky?

A number of factors affect the rates for workers’ comp. Kentucky insurance carriers typically look at the following when calculating premiums:

  • Risk of employee injuries in your industry
  • Size of your payroll
  • Where you do business
  • Your company’s insurance claims history

How NEXT Insurance helps Kentucky businesses

NEXT offers Kentucky workers’ compensation insurance designed for small businesses, self-employed and sole proprietors.

It’s easy to get a quote, review coverage options, purchase insurance and receive your certificate of insurance online — all in just 10 minutes or so.

Start an instant quote online today.

Other business insurance policies that are important in Kentucky

Workers’ compensation insurance is essential for most Kentucky businesses, but you’ll still need to get additional business insurance in Kentucky to make sure you are protected from the risks you face as an employer. Here are a few options to consider adding to your custom business insurance package:
We typically recommend:
General Liability
General Liability Insurance

General liability insurance provides protection for some of the most common business risks, such as expenses related to property damage or customer injuries.

Commercial Auto
Commercial Auto insurance

You’ll need commercial auto insurance if you or your employees drive for work-related purposes. This insurance protects your business from unexpected expenses resulting from involvement in an accident.

Errors & Omissions
Professional Liability insurance (E&O insurance)

Professional liability insurance provides financial protection against claims of professional negligence. If you make a mistake on the job, it can also help cover the costs to fix it.

Get customized insurance wherever you do business

Learn more about workers’ compensation insurance options in the state where you work.

Customer reviews

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I was looking around trying to compare insurance and I am so lucky I found NEXT. I was able to compare levels of coverage, and all the options, without pressure from a salesperson or time limits. I was able to check out prices and it was more coverage for less than the “traditional” company I looked at.
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I needed liability insurance for my new small business brick & mortar location. I got the run around from another company, but NEXT provided a competitive insurance quote in a timely manner. I now have the insurance that I need and it was stress-free!
Nicole E.

Let’s find the coverage you need for your business

Business insurance is divided into different policies. We offer seven types so it's easy to design the coverage that fits your business.

General Liability insurance
General Liability

Protect yourself from accidents that cause physical injury or damaged property.

Professional Liability or Error and Omissions Insurance
Professional Liability/E&O

Shield yourself from lawsuits that claim your work errors caused financial losses.

Workers' Compensation Insurance
Workers’ Compensation

Cover medical bills and lost wages if your employees have an accident at work.

Commercial Auto Insurance
Commercial Auto

Stay on the road with coverage for dents, tows and damage to someone else’s vehicle.

Tools & Equipment Insurance
Tools & Equipment

Upgrade your general liability coverage to protect any gear that’s stolen, damaged or lost.

Commercial Property Insurance
Commercial Property

Keep your building, inventory and equipment protected from fire or water damage.

Business Owner’s Policy Insurance
Business Owner’s Policy

Combine general liability and commercial property into one policy to protect your business.

Workers’ Compensation laws every business owner should know

Workers’ Compensation laws every business owner should know

Kentucky general contractor license and insurance requirements

Kentucky general contractor license and insurance requirements

Workers’ Compensation laws every business owner should know

Workers’ Compensation laws every business owner should know

* To the extent permitted by law, applicants are individually underwritten, not all applicants may qualify. Individual rates and savings vary and are subject to change. Discounts and savings are available where state laws and regulations allow, and may vary by state. Certain discounts apply to specific coverages only.
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Issuance of coverage is subject to underwriting. Not available in all states. Please see the policy for full terms, conditions and exclusions. Coverage examples are for illustrative purposes only. Your policy documents govern, terms and exclusions apply. Coverage is dependent on actual facts and circumstances giving rise to a claim. Next Insurance, Inc. and/or its affiliates is an insurance agency licensed to sell certain insurance products and may receive compensation from insurance companies for such sales. Policy obligations are the sole responsibility of the issuing insurance company. Refer to Legal Notices section for additional information.