What to Know
- Construction and trade contractors are unique in the way their jobsites, co-workers and employers change with each job they work on, which can make it difficult to understand the limits of a workers’ compensation policy.
- Subcontractors are the liability of the general contractor, unless they carry their own workers’ compensation insurance. General contractors must cover subcontractors under their work comp policy, or require subcontractors to show proof of insurance before stepping on the jobsite.
- Because it is very physically demanding, construction businesses and trade contractors are higher risk compared to other industries.
Workers' Compensation Insurance Cost: What Trade Contractors Need to Know
- Heavy equipment, dangerous tools, heights and working outdoors can all make for potentially hazardous working conditions. The construction and trade contractors industry is diverse, ranging from the highly risky roofing jobs to relatively safe plumbing operations.
- Working at heights above 15 feet, on roofs or in trenches will make your business a greater risk.
- If you perform work outdoors, your level of risk could vary depending on your state’s climate and weather patterns (extreme heat, snow, natural disasters).
Factors That Impact Coverage
- You are a sole proprietor, partner or member of an LLC: In Wisconsin, you are not considered an employee and excluded from coverage but have the option to include yourself.
- You are a corporate officer: You are considered an employee and included in coverage; however you may exclude yourself under certain circumstances.
About Work Class Codes
Many businesses have several work class codes that describe what their employees do. It’s important to classify each group of employees accurately because it could alter your premium dramatically.
Construction & Trade Contractors Work Class Codes
- Specialty trade contractor
If you employ workers in multiple states or your employees are temporarily working out-of-state, you need to purchase insurance for all the states where your workers are located, according to each state’s laws.
The nature of your business, number of employees being covered and past coverage and claims are all factors in how much your premium will cost.
Learn more about workers’ comp insurance rates >>