The Badger State is home to abundant natural resources. The northern, wooded areas power prolific paper manufacturing. And the 15,000 lakes attract fishermen and boating tourism. In the southern part of the state, the cows of dairyland make Wisconsin the biggest producer of cheese, milk, and butter in the entire country.
Altogether, these factors make Wisconsin an ideal location to start up or move your business. According to the 2020 Small Business Association profile1, 456,884 small businesses make up 99.4% of all businesses in the state and employ 49.5% of all private sector workers. For all these small businesses to survive, they need insurance.
Wisconsin business insurance requirements
In the state of Wisconsin, business insurance is regulated by the Office of the Commissioner of Insurance (OCI).2
As with most states across the US, there are two main forms of insurance legally required for businesses that operate in Wisconsin:
- Workers’ compensation insurance
- Auto liability insurance
Beyond these required coverages, there are others you should consider too. This guide will walk through all you need to know about the required and recommended coverages, as well as a useful way to simplify all your Wisconsin business insurance needs!
Workers’ compensation insurance in Wisconsin
The Wisconsin Workers’ Compensation Act was adopted in 1911 and shapes how workers’ comp functions in the state to this day. Wisconsin law requires nearly every employer with employees in the state to carry workers’ compensation.
According to the OCI’s guide to workers’ compensation3, an employer for whom any of the following are true must carry coverage:
- If you employ three or more regular part- or full-time workers regularly:
- Coverage is required immediately
- If you employ and pay one or more full- or part-time workers a total of $500 dollars or more within one quarter of a calendar year:
- Coverage is required within 10 days of the next quarter
- If you’re a farmer with six or more employees at once, across one or multiple job sites, for 20 days (consecutively or not) in a calendar year:
- Coverage is required within 10 days after the 20th day of employment
Failure to carry workers’ compensation can result in cease work orders and fines calculated per-day or in lump sum. Daily fines start at $100 dollars, whereas lump sum fines can be double the unpaid premium (or $750 dollars).
Administration of the Act falls under the jurisdiction of the Workers’ Compensation Division of the Department of Workforce Development (DWD). In practice, the DWD oversees hearing and judging claims, as well as enforcing these penalties.
Auto insurance in Wisconsin
The other major form of business insurance required in Wisconsin, as in most states, is auto insurance. Just because you use a vehicle for work, doesn’t mean you have to have a special auto policy. In some cases, you may be covered under your personal automobile insurance policy. It largely depends on who owns the vehicle, the size of the vehicle, and whether it’s used to transport people and/or property.
We know this can be confusing (like everything in insurance) so let’s use some examples to help clarify it:
Scenario 1: As a gourmet cheesemaker, your business depends on delivering gourmet Wisconsin cheese to local restaurants and speciality stores. As delivering goods is a core function of your business you need commercial auto insurance.
Scenario 2: As an independent photographer you travel to and from shoots and events. Capturing the events and editing the photos is the key function of your business. As such, your personal auto policy should be enough to cover you.
However, as with insurance the fine print matters. Check with your broker to see what is required in your situation.
Irrespective of which type of auto policy you need, minimum required coverages are the same for personal and business owned autos. According to an OCI guide to auto insurance4, minimum coverages required include:
Bodily injury – Liability coverage in the event that your company car causes injuries to a third party in a collision:
- $25,000 dollars per person
- $50,000 dollars per accident
Property damage – Liability coverage in the event that your company car causes property damage to a third party in a collision:
- $10,000 dollars per accident
Uninsured motorist – Coverage for the driver and passenger(s) of your company car in the event that they are struck by an uninsured third party:
- $25,000 dollars per person
- $50,000 dollars per accident
Unlike several other states, Wisconsin does not require personal injury protection (PIP), which covers the drivers and passengers of company cars. Businesses should still consider it to protect against the financial burdens that accompany injuries and damages.
Other Wisconsin business insurance considerations
When it comes to securing business insurance in Wisconsin, the basic legal requirements shouldn’t be end-all. After all, small businesses face many different types of risk. Three of the most important baseline insurance coverages that businesses should consider are:
General liability insurance – This type of insurance provides coverage for claims arising from third parties who suffered injuries or damages on your premises or as a result of your work. It provides investigation, defense, and settlement for claims related to:
- Bodily injury
- Property damage
- Personal and advertising injury
Professional liability insurance – This type of insurance provides coverage for claims arising from third parties who suffered a financial loss due to the professional advice you gave (or didn’t give) them. It provides investigation, defense, and settlement for claims related to:
- Errors and omissions
- Actual or alleged negligence
Professional liability is often most applicable to white collar fields like consulting, whereas general liability covers a wider range of professions (construction fields, etc.). For many small businesses, it makes sense to have both.
- The cost of damages to your equipment that occur wherever you work
- The replacement costs of property in your care in the event of an accident
- The replacement cost of stolen property (unless the equipment is taken from an unattended, unlocked vehicle
Note: With Thimble, equipment insurance (known as Business Equipment Protection) can be bundled with your general liability policy. Our policies are sold on a “blanket coverage basis,” which requires you (the named insured) to list out every item for which coverage is desired as well as the per item cost. The policy covers the equipment on a replacement cost basis, meaning valid claims will pay the value to repair or to replace the equipment.
Liability insurance may actually be legally required for businesses in certain industries, depending on where in Wisconsin you’re located. Even when not required, clients and customers may make their hiring decision based on what types of safeguards and risk management tools you have in place.
How to get Wisconsin business insurance
If you’re starting, moving, or otherwise operating a business in the great state of Wisconsin, you’ll need to secure business insurance policy to flourish. First and foremost, as with most places in the US, the coverages you’re legally required to have are workers’ compensation insurance and auto liability insurance.
But these aren’t the only forms of business insurance coverage you should get. Companies should also consider various forms of liability insurance, such as general and/or professional liability coverage, depending on the nature of your business. The last thing you want to do is puzzle over complicated insurance policies.
That’s why we’ve upgraded small business insurance for the 21st century. At Thimble, we believe all companies deserve an insurance policy that’s:
- Tailored to their needs
- Easily available
With us, you can purchase insurance coverage that goes by the hour, day, or month. Our coverage works when you do, so you save on coverage you don’t need. Plus, signing up is as easy as 1, 2, 3.
Just download the Thimble mobile app or click on “Get a Quote,” then answer a few simple questions. From there, we’ll generate an instant quote and you can purchase it with one final click. In less than 60 seconds, you’ll have insurance customized for your small business and your policy and any required Certificates of Insurance (COI) waiting in your email inbox.
You can add Additional Insureds at no additional charge and generate as many COIs as you need for free. And you can go through the process without a single hassle. That’s Thimble.
Our editorial content is intended for informational purposes only and is not written by a licensed insurance agent. Terms and conditions for rate and coverage may vary by class of business and state.