By Default, You Are Not Covered in Your Workers' Comp Policy
You are not automatically covered in your workers' comp policy. That means your policy only covers your employees. It does not cover you, the sole proprietor, unless you choose to add yourself.
Adding yourself is called an owner inclusion election. It is a choice you make when you get your quote. You must pick it if you want to be covered. It is not automatic.
Some people call this an 'owner inclusion election', which means you are choosing to be included in the policy. That is different from being left out, which is the default.
Why Are Sole Proprietors Left Out by Default?
Workers' comp policies are written to cover employees who get hurt at work. The owner is not an employee by default. That is why you are not included in the policy unless you choose to be.
Some states treat the owner differently. For example, in some states, the owner of a limited liability company (LLC) is considered an employee. But for a sole proprietor, you are not an employee unless you choose to be one in your policy.
This is why it is important to check your policy. If you are not included, your policy does not protect you if you get hurt at work.
When Do You Make the Owner Inclusion Choice?
You make the owner inclusion choice when you get your quote. That is when you first set up your policy. You can choose to be included or not. You can also see what it will cost you to be included.
Some people choose to be included because they work the same way as their employees. For example, if you are on your feet all day and at risk of injury, you might want to be covered.
If you are not included, your policy will still work for employees. But it will not pay for your own injuries. It is a choice you must make at quote time.
What Happens to Your Price if You Choose to Be Included?
If you choose to be included, your workers' comp policy will cost more. The price depends on your state and the kind of work you do. You can see the full cost when you get your quote.
The reason the price goes up is because you are now part of the policy. You are now a 'covered person'. That means your policy will pay for your injuries at work, just like it would for an employee.
Some people think the price is too high to include themselves. That is okay. You can choose not to be included. But you should know that your policy will not protect you if you get hurt at work.
How Do You Know if You Are Included in Your Policy?
Your policy document will say whether you are included or not. It is usually a short sentence that says something like: 'The owner is included in the policy' or 'The owner is excluded from coverage.'
If you are not sure, you can check your policy or ask your insurance company for help. You can also get your quote and choose to be included to see what it costs.
It is important to know whether you are included, especially if you work the same way as your employees. You do not want to get hurt and find out your policy does not cover you.
Some States Treat Sole Proprietors Differently
In some states, the law treats sole proprietors like employees. That means you are automatically included in your workers' comp policy. But that is not the case in all states. It depends on where you live and work.
Some states allow you to choose whether to be included or not. Others do not. You should check your state's rules to know what applies to you.
If you are unsure, it is best to get your quote and see how your state treats sole proprietors.
What If You Change Your Mind Later?
After you choose to be included or not, you may wonder if you can change your mind. That depends on your policy and your state. Some policies allow you to change your election by getting an endorsement. Others do not.
The best way to know is to look at your policy documents or ask your insurance company. You can also get your quote to see what options are available.
Remember, the choice you make at quote time is your main way to decide whether to be included. If you want to change it, you may need to go through the quote process again.
