Workers’ Compensation Insurance for Companies that Employ 1099 Contractors

If you work as a 1099 employee in New Jersey, it is important that you understand whether or not you are covered by Workers’ Compensation. In most cases, independent contractors have to get their own insurance.

A temporary employer’s Workers’ Compensation does not automatically cover an independent contractor. If you are an employer, make sure you are properly classifying workers as 1099 employees. If you misclassify workers, you might be penalized by the state. Though not required to purchase Workers’ Compensation plans, 1099 employees can get coverage if they wish. Purchasing a Workers’ Compensation policy as an independent contractor is wise, as doing so can allow you to access important benefits in the event that you are injured on the job in New Jersey.

For more information about what our New Jersey Workers’ Compensation insurance brokers can do for 1099 employees, call NPN Brokers now at (561) 990-3022.

Automatic Workers’ Comp Coverage for 1099 Employees in New Jersey

While many employees are automatically covered by Workers’ Compensation from the day they begin working for a business in New Jersey, the same is not true for 1099 workers.

Independent contractors are not considered regular employees in New Jersey, meaning companies do not need to include 1099 employees as part of their payroll for Workers’ Compensation. While it is not impossible for employers to provide insurance coverage to 1099 employees, it is very rare. Independent contractors are also not required to purchase a Workers’ Compensation policy for themselves in New Jersey.

This means that you will most likely not be covered by Workers’ Compensation, even if you begin a contracted job for an employer that has Workers’ Compensation in New Jersey. If you want to make sure that you will have access to Workers’ Compensation benefits as an independent contractor, you should get your own policy. Independent contractors should not expect to be covered by an employer’s Workers’ Compensation, as doing so might leave them without access to benefits if they are hurt at work.

Misclassifying Workers as 1099 Employees for Workers’ Comp in New Jersey

While 1099 employees are generally not eligible for Workers’ Compensation through an employer’s coverage, there are some exceptions to this rule. For example, if regular workers are improperly classified as 1099 employees, they will likely be eligible to receive benefits in New Jersey.

New Jersey’s definition of an independent contractor is phrased in a way that might be confusing for some employers, causing them to misclassify certain workers as 1099 employees. Checking your employee classifications against New Jersey’s Workers’ Compensation mandates and definitions is essential, as unintentional misclassification of employees could cause your company to incur considerable financial penalties. Our Workers’ Compensation insurance brokers can ensure that the information given to your carrier is accurate and results in coverage for all necessary workers, excluding properly classified 1099 employees.

Workers’ Comp Policies for 1099 Employees in New Jersey

Independent contractors can do all types of work in New Jersey, ranging from construction to administrative work. The classification of a 1099 worker explains their relationship to their employer and excludes them from getting Workers’ Compensation insurance benefits. That said, 1099 employees can purchase their own insurance if they so choose.

Although independent contractors are not required to have Workers’ Compensation since they are technically self-employed and do not have any additional workers, they can get coverage for themselves in New Jersey. This can allow you to stay protected in case you are injured while working and allow you to avoid unnecessary litigation with an employer.

Workers’ Compensation policies for 1099 workers are typically less expensive, as they do not need to provide coverage for many individuals. Depending on the industry you work in, premiums might increase or decrease. For example, 1099 employees in the construction industry may be at a higher risk of sustaining workplace injuries than independent contractors working as private chefs. Regardless, the price of monthly Workers’ Compensation premiums will likely be negligible, especially considering the possible expense of medical bills and lost wages if you are hurt on the job and cannot get Workers’ Compensation benefits in New Jersey.

Importance of Workers’ Comp for 1099 Employees in New Jersey

Independent contractors, though they might work for companies temporarily, are self-employed. Because they cannot rely on the support of a larger company, 1099 employees should take matters into their own hands and get their own Workers’ Compensation policies in New Jersey.

If a 1099 worker is hurt on the job, they cannot get Workers’ Compensation through their employer’s policy as they are not considered a regular employee. Instead, their only options for recovery are to pursue litigation or deal with the financial implications of their injuries themselves. If no one is to blame for your injuries and you were hurt in an accident, there may be no way for you to recover compensation in New Jersey. This leaves many independent contractors in financial distress as they attempt to cover costs associated with medical bills, lost wages, and other expenses due to a workplace injury in New Jersey.

Now, if you purchase a Workers’ Compensation policy for yourself as an independent contractor, your recovery process will likely be much easier. Simply file a claim with your carrier and receive the benefits you need to offset your lost income while you heal. Getting Workers’ Compensation can also make it easier for 1099 employees to find work, as companies or clients might feel more comfortable hiring an independent contractor that is covered by insurance in case of an accident. At the end of the day, having Workers’ Compensation can provide the safety net independent contractors need to confidently perform their work in New Jersey.

Call Our New Jersey Workers’ Comp Insurance Brokers Today

Call (561) 990-3022 to speak with the Workers’ Compensation insurance brokers at NPN Brokers today.