California law requires that all employers have workers compensation insurance even if they have only one employee. Employers located out-of-state are required to have workers compensation insurance if their employees are hired in California. Sole proprietors do not need to have this coverage if they are the only person working in the business. This also applies to businesses that are jointly owned by both spouses.
Temporary and part-time employees must also be covered. Employees classified as supervision, managers or executives must also be covered.
Employees who spend the majority of their work hours outside of the office must still be insured. Employees who are allowed to drive a company-owned vehicle to and from their work site will likely not be covered if they use the vehicle for a purpose not related to their job. The workers compensation insurance carrier should be consulted about this situation.
Workers compensation insurance coverage can be purchased through a licensed agent authorized to provide this insurance in California. If an employer cannot find an insurance company that is willing to insure their business, then the State Compensation Insurance Fund is required to provide the coverage.
Employees can find out which insurance company currently insures their employer and which company provided insurance during the past five years. This information is available by consulting this website: to http://www.caworkcompcoverage.com . A nominal fee is charged for this service.
Employers can be self-insured meaning that they can create a fund for the purpose of paying the claims of injured workers. The state imposes strict regulations on these funds and the companies that establish them. Currently, 1 out of 4 employees in California is covered by company self-insured plans. Employees can check this website to verify that their employer is self-insured: http://www.dir.ca.gov/osip/sip.html.
Employees are not required to pay any part of the employer’s workers compensation insurance coverage. The insurance is considered to be the cost of doing business and employers are forbidden to ask employees to pay part of the costs.
Not providing workers compensation insurance is a criminal violation and employers are prosecuted for the violation.
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