Small Businesses Workers’ Compensation Insurance Policies in Georgia
More often than not, small businesses in Georgia need Workers’ Compensation. There are several exemptions that might apply to your small business, depending on the type of company it is.
Depending on the industry your small business is in, it may benefit from a certain type of Workers’ Compensation insurance: pay-as-you-go coverage. Small businesses with upwards of two employees will need some kind of Workers’ Compensation in Georgia, meaning most small businesses require coverage. There are some exemptions that small businesses in Georgia might be eligible for, like exemptions for partners, sole proprietors, LLC members, and corporate officers. Although your small business might be able to self-insure, there is more security in getting Workers’ Compensation from a reliable insurance company in Georgia.
Call NPN Brokers at (866) 340-9120 and speak with our Georgia Workers’ Compensation insurance brokers about getting coverage for your small business today.
Types of Workers’ Comp Insurance Policies for Small Businesses in Georgia
For many small businesses in Georgia, saving money on Workers’ Compensation insurance is a top priority. This is possible by choosing the right type of policy for your smaller company.
A pay-as-you-go plan is one of the most flexible and affordable kinds of Workers’ Compensation policies available to small businesses in Georgia. Our Workers’ Compensation insurance brokers can explain the benefits of this type of policy and how it can help your small business save on premiums. Pay-as-you-go Workers’ Compensation uses current payroll information to assess premiums rather than annual payroll estimates.
This enables small businesses in Georgia to only pay for Workers’ Compensation coverage for employees currently working for them. Many small businesses, like coffee shops and boutiques, see frequent changes in their payroll numbers throughout the year. With pay-as-you-go Workers’ Compensation plans, you can base premiums on real-time information, allowing you to more easily cut down on spending and adhere to your budget.
Workers’ Comp Insurance Needs for Small Businesses in Georgia
Depending on how small your small business is, chances are it will need some form of Workers’ Compensation liability coverage in Georgia.
Any company, regardless of industry, that employs more than two workers has to get a Workers’ Compensation policy in Georgia. Few small businesses actually employ less than three workers, meaning most will have to get insurance. So, whether you own a coffee shop, corner store, book store, or dog walking business, you will likely require Workers’ Compensation, depending on whether or not you employ workers in addition to yourself.
Because coverage is mandatory in many cases, some carriers in Georgia might increase costs for small businesses. Our Workers’ Compensation insurance brokers can help you find inexpensive coverage in Georgia, including policies that do not require contracts, deposits, or audits.
A Workers’ Compensation policy must be in place for as long as a small business is required to have it. This means that if your previous carrier canceled your policy, you must get a new one before the cancellation takes effect. If your workforce drops below three workers, you should still keep your small business’s insurance policy. Workplace accidents can still occur, regardless of the number of workers employed by your small business in Georgia.
Determining the Workers’ Comp Liability for Your Georgia Small Business
Small businesses are classified as such based on their revenue and their payroll. For Workers’ Compensation purposes, small businesses may or may not need coverage based on employment.
Any business that employs fewer than 1,500 workers might be considered small in Georgia. Because of this, only the smallest of small businesses can go without Workers’ Compensation and stay in compliance with Georgia statutes. Only companies with more than two employees need Workers’ Compensation in the state. This means that most small businesses must purchase and maintain a policy to stay in accordance with Georgia’s requirements and avoid consequences for non-compliance.
Very small businesses, meaning those with fewer than three employees, do not need Workers’ Compensation in Georgia. While some states require companies in certain industries to get coverage regardless of their size, Georgia does not.
Most small businesses in Georgia will need Workers’ Compensation. If you do not get it when required, you might face expensive financial penalties from the Georgia State Board of Workers’ Compensation.
Workers’ Comp Insurance Exemptions for Small Businesses in Georgia
Small businesses in Georgia may be able to benefit from certain Workers’ Compensation exemptions. Depending on their business formation, some small business owners might be automatically exempt from coverage.
Sole proprietors are automatically excluded from needing Workers’ Compensation in Georgia. Some small businesses start out as sole proprietorships because they are one of the easiest types of companies to form. You may need coverage for other employees if you have a sole proprietorship and employ additional workers. Because there is no legal distinction between sole proprietors and sole proprietorships in Georgia, it benefits owners of these small businesses to get Workers’ Compensation. Otherwise, they may be personally liable for covering employee injuries sustained at work. While sole proprietors are automatically exempt from Workers’ Compensation, they can opt into the system and get coverage for themselves.
Like sole proprietors, partnership partners are automatically exempt from the Workers’ Compensation system in Georgia. They do not need to get coverage for themselves and will not face fines for choosing that route. However, partnerships that employ workers in addition to partners may need to purchase a Workers’ Compensation policy in Georgia. Also, like sole proprietors, partners can elect to get Workers’ Compensation despite being initially excluded from the system.
LLC Members and Corporate Officers
Some small business owners have LLCs or corporations. Georgia allows up to five corporate officers or LLC members to exclude themselves from coverage. In doing so, LLC members or corporate officers of small businesses can lower their payroll information for Workers’ Compensation purposes and save on monthly premiums. There is a risk to excluding yourself from coverage in Georgia, as doing so makes you ineligible for benefits if hurt on the job.
Workers’ Comp Insurance Exemptions for Small Businesses in Georgia
Small businesses might be eligible for certain Workers’ Compensation exemptions depending on the way they are formation. That does not mean, however, that they should always use those exemptions.
Georgia permits up to five corporate officers or LLC members from the same company to exempt themselves from coverage at the same time. This can reduce the number of workers included in your small business’s information, allowing you to benefit from lower insurance premiums. Georgia does not allow corporate officers or LLC members to exempt themselves for the purposes of eliminating a company’s Workers’ Compensation liability.
It is important to understand that if an employee of your small business exempts themselves from Workers’ Compensation, they will not be eligible to receive benefits if hurt on the job. This means filing for exemptions might not be the best course of action, especially if eligible workers are involved in day-to-day operations or at risk of workplace injury.
Sole proprietors, farm laborers, partners, and independent contractors are also exempt from needing Workers’ Compensation in Georgia. Employees can file for exemptions using Form WC-10 or revoke a previous exemption using the same form.
Liability for Small Businesses without Workers’ Comp Insurance in Georgia
Not having Workers’ Compensation can put your small business in jeopardy if a workplace accident happens in Georgia. The financial implications alone could cause serious issues for companies that are on the smaller side.
If you need to have Workers’ Compensation under Georgia law but do not get it, your small business could be held liable for a worker’s injuries in the same way as if they had insurance. That is to say, an injured worker will still receive benefits, but instead of a carrier paying them, the employer will. Benefits will cover a portion of an employee’s lost wages as well as their medical expenses. Workers’ Compensation does not provide damages for pain and suffering in Georgia.
Additionally, the Georgia State Board of Workers’ Compensation reserves the right to increase benefits paid to an injured worker by 10% to further punish a small business for not having the proper insurance coverage.
Regardless of your small business’s industry, workplace injuries can be extremely expensive. Covering an injured employee’s medical bills and lost wages for weeks, months, or possibly years, could cause serious financial strain on your small business in Georgia.
Small businesses can be held liable for any workplace injury, provided it was not caused intentionally by a hurt worker.
Penalties for Small Businesses without Workers’ Comp Insurance in Georgia
In addition to being financially responsible for an employee’s damages, small businesses without Workers’ Compensation can face more financial penalties from the state.
For each documented violation of Georgia’s mandate to provide Workers’ Compensation to employees, small businesses can incur a fine of between $500 and $5,000. Any attempt to interfere with the claims process can result in a fine of up to $10,000. Other Workers’ Compensation law violations, like failure to provide the necessary information to employees, can result in fines of up to $1,000.
Additionally, failure to provide Workers’ Compensation when required to is a misdemeanor offense that carries a fine of up to $10,000 or 12 months in prison and, in some cases, both penalties.
The Board of Workers’ Compensation in Georgia can be made aware of an employer’s failure to provide insurance from employee reports. These typically occur after workplace injuries, but employees can report their small business for non-compliance at any time.
Ways to Get Workers’ Comp Insurance Coverage for Small Businesses in Georgia
In most cases, small businesses in Georgia should get Workers’ Compensation from an insurance carrier. While self-insuring might be an option, it also might leave small businesses in difficult financial situations after an employee injury.
Small businesses can get Workers’ Compensation from a reliable carrier in Georgia. Our brokers can find a policy that does not require expensive deposits, audits, or contracts and provides you with comprehensive coverage for all of the employees within your small business. The alternative to going with an insurance company is self-insuring.
Provided they can prove they are financially secure enough to handle costs stemming from a workplace accident, small businesses in Georgia can self-insure for Workers’ Compensation. Even for large businesses, self-insuring is risky, especially if serious and debilitating workplace accidents occur. Because of this, getting Workers’ Compensation insurance from a carrier may be the best path to take for small businesses in Georgia.
Get Workers’ Comp in Georgia for Your Small Business Today
Call NPN Brokers at (866) 340-9120 and get a policy quote from our Workers’ Compensation insurance brokers today.
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