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Tennessee Workers' Compensation Insurance 

In most cases, businesses with five or more employees must carry workers’ compensation insurance, whether they are full-time, part-time, seasonal or family members. Businesses that operate within Tennessee must comply with the state’s workers’ compensation regulations.

The average workers’ compensation insurance rates have been steadily declining over the past five years, ever since the state passed reforming legislation in 2013.

Read on for what you need to know to get work comp in Tennessee.

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Small Business Work Comp Requirements in Tennessee

Tennessee small businesses are required to carry workers' compensation insurance if they have five or more employees. Coal mining, construction and trades businesses must have insurance if they have one or more employees, and owners must also have coverage on themselves, unless they request an exemption.

Employee Limits

If considered employees, family members, part-time employees and corporate officers count toward the employee limits.

Corporate Officers

Corporate officers in non-construction business may exclude themselves, but they still count toward the five-employee limit.

Subcontractors and Independent Contractors

Many subcontractors and independent contractors are sole proprietors or partners. Unless you’re an employee, you won’t be covered by their insurance policy and may need to provide proof of work comp.

How to Buy Small Business Workers’ Compensation Insurance

Tennessee has a private market, which means employers can purchase a workers' compensation policy from any insurance carrier or agency that is licensed to write in that state.

To get coverage, contact a licensed insurer and request a quote. Employers need to provide basic business details, including locations, EIN number, type of work the business does, the total payroll that needs coverage and any prior history of work comp coverage or claims.

The state does not offer a state insurance fund, but employers struggling to find coverage can contact NCCI, which administers Tennessee’s Workers Compensation Insurance Plan.

Coverage and Rates in Tennessee

The state underwent reforms to its workers’ compensation system about five years ago, which has led to a decrease in rates.

The governor signed legislation in 2013 overhauling portions of the system, and in 2015, Tennessee decided to eliminate the Tennessee Workers Compensation Insurance Plan (TWCIP) and replace it with NCCI’s Workers Compensation Insurance Plan.

NCCI, or National Council on Compensation Insurance, is used by many states to collect workplace injury data, recommend insurance rates, or administer a workers’ comp insurance plan.

Tennessee chose NCCI to administer workers compensation residual market services, which offers coverage to businesses that can’t find coverage through private insurers. The state also uses NCCI to recommend rates. If accepted, insurers must use these rates as a baseline for premiums. The nature of the business, total payroll being covered, claims history and other individual factors all influence the total cost. Learn more about how much workers’ compensation policies cost.

Most recently, NCCI filed for a 19.1% decrease, the largest since reforms were passed in 2013. This would be the eighth consecutive decrease in rates.

Tennessee Work Comp Resources

Editor’s note: Last updated on September 24, 2018

Here's What You Need to Get Started

To buy workers compensation insurance, you need to request a quote from a licensed insurance agent and provide some details about your business.

Here’s what to have in front of you:

  • Number of employees in each class code.
  • Total payroll for all employees. You may be able to exclude yourself if you don't wish to be covered under the policy. 
  • Federal ID Number. If you are a sole proprietor, you can use your Social Security Number.
  • Copy of your workers comp insurance policy, if you've had coverage or claims in the past few years. If you know your company's experience mod, please have your experience mod rating sheet or policy in front of you. Otherwise, you will be assigned a default rating of 1.0.

The information on this page has been interpreted and summarized for your convenience. Please consult your state's governing authority for the most current and complete legislation.