Workers’ compensation insurance is required for all businesses in New Mexico with three or more employees. This requirement applies whether the workers are residents or non-residents of New Mexico.
Part-time, seasonal and temporary workers are all counted as employees, according to New Mexico workers’ compensation laws. The coverage requirements also apply to agricultural employers and nonprofit, charitable and religious organizations.
Additionally, all employees engaged in construction in New Mexico must have coverage, even if the employer has fewer than three employees total.
New Mexico workers’ comp requirements are not enforced on tribal lands within the state, although tribes may voluntarily enforce the requirement.
Businesses operating on a Native American reservation or pueblo must follow the guidelines of that tribe.
In addition to obtaining the required workers’ comp insurance, New Mexico employers are required to:
Businesses with less than three employees can opt out of workers’ comp. But as an employer, you can still be held responsible for expenses if an employee gets hurt or ill on the job. For example, an injured employee could file a liability lawsuit against an employer without any defined limits on the damage award.
If an employee is injured on the job, a New Mexico workers’ comp policy can help cover the following expenses:
Voluntary business owners coverage is also available for employers.
The expenses that accrue as a result of a work-related injury or illness could be covered by workers’ compensation New Mexico. This could include:
New Mexico offers five indemnity benefits to compensate for wage loss and/or functional impairment:
Temporary total disability: The employee is unable to work temporarily due to their injury.
Temporary partial disability: The employee is still able to work in some capacity, but at a reduced wage or fewer hours per week.
Permanent total disability: The employee suffers a severe, permanent injury, such as total loss of use of both hands or eyes.
Scheduled injury: The employee suffers the loss of use of a specific body part.
Whole body impairment: The employee suffers an injury to the body, with benefits determined by their ability to return to work and other factors.
If an employee dies as a result of a work-related injury or illness, death or survivor benefits could be paid to their dependents. Funeral benefits of up to $7,500 may be paid as well.
If an out-of-state employer has an employee working in New Mexico, they can get an insurance endorsement from their insurance carrier to cover accidents that occur within the state — as long as that carrier is also licensed in New Mexico.
If that’s not an option, they must obtain a separate New Mexico policy.
Workers’ compensation costs vary across industries. Factors that influence price include:
The best way to determine the insurance rate for your business is to get a free instant quote from NEXT.
Employers can face penalties if they fail to comply with the state’s requirements for workers’ compensation insurance. Some examples include:
New Mexico employers do not need to provide coverage for the following employees:
When determining the total number of employees in a business, the owner is included if they work in the business.
Executive employees or sole proprietors may opt out of coverage, but they’re still counted in the number of workers for the business.
If you’re a sole proprietor who wishes to be exempt from workers’ comp coverage requirements, you must have your exemption approved by the WCA Compliance Bureau.
Construction corporations, partnerships and LLCs must all have coverage, even if there is only one executive employee. Those who wish to minimize expenses for premiums may elect to forgo coverage for executive employees by filing an Executive Employee Affirmative Action Election form with their insurance carrier.
Employers who prefer to self-insure their business rather than obtaining coverage from an insurance carrier may apply to the WCA Compliance Bureau to receive written approval.
These employers may apply individually or as part of a group of employers in the same or similar industry.
Requirements for self-insurance approval in New Mexico include:
NEXT strives to resolve every claim quickly. Learn more about our claims process and how our claims advocates will work with you after an employee injury.
Start a free instant quote with NEXT.
General liability insurance protects your business from common mistakes or accidents, such as customer injury or damages to someone’s property.
In New Mexico, all business-owned vehicles must be covered by commercial auto insurance. If you drive or use your personal vehicle for work, commercial auto insurance helps protect your business from accidents.
Commercial property insurance can provide financial help if your business structures, goods, gear or inventory are damaged or destroyed by a covered event.
Learn more about workers’ compensation insurance options in the state where you work.
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