When it comes to workers’ compensation insurance, Washington is a monopolistic state. This means that employers may only purchase coverage through the state-administered fund.

The Washington Department of Labor and Industry assigns every type of job a base rate for workers’ compensation coverage.

Let's look at the base rates for a few different occupations in Washington. These are the rates employers will pay for every $100 of employee payroll.

• Landscapers:  $1.80
• Tree Trimmers/Removers/Pruners:  $4.71
• Plumbing Contractors:  $1.58
• Roofers:  $5.69
• Retail Store Workers:  $0.48
• Clerical/Office Employees:  $0.17
• Restaurant Workers:  $0.40
• Truckers: $3.36

As you can see, workers’ comp rates are higher for jobs with an increased risk of employee injuries. The quoted cost for your business will be based primarily on the number of workers you employ, the kinds of jobs they do, and how much they are paid.

Washington state law requires all employers to carry workers’ compensation insurance. There are a few exceptions. You are not required to purchase coverage for:

• Sole proprietors, partners, corporate officers, and LLC members
• Private residential gardeners and maintenance/repair workers
• Most household/domestic workers
• Minors working on a family farm
• Musicians and entertainers at certain events
• Barbers and cosmetologists who rent or lease their workspace

Policies may only be purchased through the state-administered fund. Coverage through private insurance companies is prohibited, but qualified businesses may opt to self-insure with approval.

If an employee is injured on the job or is diagnosed with an occupational illness and is approved for workers’ compensation, this insurance can cover:

• Medical benefits: This provides complete coverage for all reasonable and necessary medical care, including doctor’s appointments, emergency care, ambulance rides, physical therapy, chiropractic care, prescription medications, and supplies like slings and braces. Any doctor may perform the initial treatment, but all further treatment must be obtained through an L&I network provider.
• Automobile and home modification costs: If an employee’s injury results in an amputation or paralysis and modification to their home and/or car are needed, workers’ compensation can cover these costs as well as cover prosthesis maintenance and replacement costs for life.
• Wage loss benefits: Employees who must take more than three days off work to recover from an occupational illness or injury can receive time-loss compensation payments.  These payments can range from 60% to 75% of their average weekly pay, depending on factors like marital status and the number of dependents the employee has.
• Permanent partial impairment benefits: If an employee's injury results in permanent loss of a body part or function, in addition to other workers’ comp benefits, the employee will be awarded a lump sum payment based on the nature and severity of the impairment.
• Vocational rehabilitation services: Workers’ comp can cover the cost of a vocational counselor who can help employees explore their return-to-work options. For workers who cannot return to their former vocation due to a work injury or illness, this can cover the cost of retraining to learn new skills.
• Travel expenses: If an injured worker must travel more than 15 miles from home for necessary medical care or vocation training, workers’ compensation insurance can reimburse them for their out-of-pocket travel expenses.
• Pension awards: If an employee’s illness or injury results in permanent inability to work in any capacity, they may be entitled to a monthly pension for life.
• Death benefits: If an employee’s work-related injury is fatal, workers’ comp can help cover their funeral and burial expenses and provide ongoing survivor benefits to the employee’s spouse and dependents.

Additionally, workers’ compensation can help employers by covering the cost of modifying the workplace to accommodate a worker who has become disabled due to an on-the-job accident.

Sometimes workers’ compensation claims are denied. Some common reasons for claims denial in Washington include:

• The injured employee did not seek medical treatment for their injury
• The injury did not occur while the employee was working
• The injured employee was intoxicated or under the influence of illegal drugs when the injury occurred
• There is reason to believe the injury was intentionally self-inflicted
• The injury occurred while the employee was committing a felony or was engaged in horseplay
• The injury or illness is a preexisting condition
• The employee’s illness is not considered an occupational disease

If an employee believes that their claim was unjustly denied, they can appeal the decision to the Board of Industrial Insurance Appeals or a higher court.

You can prove your compliance with workers’ compensation laws with a Certificate of Coverage. This certificate is a single-page document that offers information about your coverage, including details like:

• All relevant workers' compensation policy numbers 
• The effective date and expiration date for each policy listed

You will be issued a certificate of coverage by the state when you purchase or renew your policy or upon your request. A copy of your certificate must be displayed in a conspicuous location at your place of business. If you have more than one business location, a copy must be posted at each.

Even though there is only one place to purchase workers’ compensation insurance in Washington, it pays to work with an independent insurance agent. These agents can ensure that you understand the ins and outs of your policy and can help you with any other commercial insurance policies you may need for your business.

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 get more information.

No. Workers' compensation insurance benefits paid to employees are not considered taxable income on the state or federal level.