VermontWorkers' Compensation Insurance

Workers’ compensation rates in Vermont are higher than the national average. In this state, every type of job is assigned a base rate for workers’ compensation coverage by the VT Department of Labor: Division of Workers' Compensation and Safety. These rates are commensurate with how hazardous the jobs are.

Insurance companies must use these base rates to determine policy costs, but they are permitted to adjust rates up to 25% through policy debits and credits. Let's look at the base rates for a few different kinds of jobs in Vermont.

These are cost ranges for every $100 of employer payroll:

• Landscapers:  $5.49 to $7.80
• Tree trimmers:  $10.32 to $14.66
• Plumbers:  $3.21 to $4.56
• Roofing contractors:  $14.12 to $20.06
• Retail store workers:  $1.19 to $1.69
• Clerical/office workers:  $0.15 to $0.21
• Restaurant workers:  $1.10 to $1.56

Companies with a solid safety record will pay rates at the lower end of the price range, while those with higher-than-expected employee injuries will pay the higher costs.

Your actual quoted cost will be based on the number of employees you have, the types of jobs they do, how much they are paid, and your company’s safety and insurance claims history. A local independent insurance agent can help you obtain and compare rates from a few competing insurance providers.

Vermont state law requires all employers to carry workers’ compensation insurance. There are a few exceptions. You are not required to cover:

• Sole proprietors, partners, corporate officers, and LLC members
• Casual employees
• Domestic/household workers
• Nannies
• Agricultural/farm laborers who work for employers whose payroll is less than $10,000 per calendar year

Businesses that work with independent contractors must determine in writing who is responsible for buying workers’ compensation insurance. If the independent contractor is uninsured, your business will need to purchase coverage for them.

Coverage may be obtained through a commercial provider, or, with approval, companies with a solid financial backing may opt to self-insure.

Workers' compensation can cover employees if they experience work-related traumatic injuries, repetitive stress injuries, cuts and lacerations, sprains and strains, fractures, certain work-related mental health disorders, and occupational illnesses.

Workers' compensation insurance in Vermont can provide injured employees with:

• Full coverage for medical care: Workers’ comp will pay for all reasonable and necessary medical services and supplies related to workplace injuries. This can include doctor visits, hospital stays, ambulance services, physical therapy, chiropractic treatments, medications, and psychological counseling.
• Compensation for lost income: Employees who need time off from work to recuperate from their injuries can receive disability pay of 2/3 of their prior income.
• Vocational rehabilitation services: Workers whose injuries keep them away from work for at least 90 days or have left them unable to return to suitable employment may be referred to vocational rehabilitation services to help them train for and obtain suitable employment.
• Death benefits: If a work injury or illness is fatal, workers’ compensation can provide the employee’s spouse and dependents with ongoing compensation of 2/3 of the employee’s pay prior to the incident. In the absence of dependents, it can cover up to $5,500 in funeral and burial expenses.

In most cases, by accepting workers’ compensation coverage, employees forfeit their right to sue their employer for their injuries.

As with any type of insurance coverage, workers' comp has some exclusions. Your insurance company is likely to deny coverage for claims involving:

• Injuries sustained by employees who failed to use safety equipment provided by the employer
• Injuries sustained outside of work or while at a work-related recreational event
• Injuries that occurred while the employee was intoxicated, using illegal drugs, engaged in horseplay, or committing a serious crime
• Intentional or self-inflicted injuries
• Common short-term illnesses like influenza or headaches
• Recurring preexisting conditions (However, preexisting conditions aggravated by the work being done by an employee are usually covered.)

An independent insurance agent in Vermont can further explain what your workers' compensation insurance policy will and will not cover.

Contractors frequently have to provide prospective clients with proof that they are covered by workers’ compensation insurance if they will be working on-site, especially if they are bidding on a government contract.

A workers’ compensation certificate of insurance can provide this proof of coverage. These single-page documents provide information about your coverage including details like:

• The name and address of the insured
• The name of the insurance company and all related policy numbers
• The effective date and expiration date for each policy listed

You will be issued this certificate by your insurance company when you purchase or renew your policy. 

Alternatively, clients and employees can verify your coverage status by doing an online search since Vermont keeps a database of all current workers’ compensation insurance policies.

Independent insurance agents make it easy to find the right workers’ comp coverage because they do the comparison shopping for you. These agents are available to answer your insurance-related questions and can help you obtain and compare customized quotes from some of the best insurance companies in the state.

No business is too small to benefit from the help of an independent agent. Arrange an obligation-free consultation with an independent insurance agent near you to begin your search for the best workers’ compensation insurance policy in Vermont.

Workers' compensation benefits are not considered taxable income.

However, if the injured employee is simultaneously collecting Social Security Disability Insurance (SSDI) or Social Security Supplemental Income (SSI) benefits, there may be some tax implications.