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In almost every U.S. state, employers are required by law to carry workers’ compensation insurance if they have a certain number of employees. If you’re a business owner in Oklahoma, you must carry workers’ comp insurance if you have at least one employee. Like most states, Oklahoma specifies a few employee types that are exempt from compulsory coverage.
Workers’ compensation is one of many small business insurance types all Oklahoma entrepreneurs should consider.
In this article, we’ll go over who you need to cover, who is exempt, and possible penalties for non-compliance.
How does workers’ compensation insurance in Oklahoma work?
The state of Oklahoma requires you to carry workers’ compensation insurance as soon as you have five or more employees that are not exempt from mandatory coverage.
Businesses can get coverage in five ways:
- By purchasing a policy from a private insurer or broker
- By qualifying and obtaining approval from the Workers’ Compensation Commission to become a self-insurer
- Becoming a member of a self-insured employer group approved by the Workers’ Compensation Commission
- Becoming a “qualified employer” (an employer who writes their own insurance plan) with approval by the Oklahoma Insurance Department
- Through Oklahoma’s assigned risk market via CompSource Mutual
Who needs workers’ compensation insurance in Oklahoma?
Nearly every employee in Oklahoma must be covered by workers’ compensation insurance, with some exceptions. Individuals who are exempt from mandatory coverage include:
- Agricultural or horticultural workers employed by a farm with a rolling annual payroll of less than $100,000
- Federal employees
- Commissioned real estate agents or brokers
- Medical or social workers administered by the Department of Human Services
- Workers related to an employer by blood or marriage, where there are 5 or less workers who all fit this criteria
- Independent contractors
As a business owner or sole proprietor, you don’t have to purchase workers’ compensation insurance for yourself. That doesn’t mean you shouldn’t get coverage. Sustaining an injury or illness while performing your work can lead to sizable hospital bills, medical costs and a lengthy recovery period. Investing in workers’ comp for yourself could save you from a brutal financial setback.
What are the penalties for not having workers’ comp in Oklahoma?
Being uninsured in the state of Oklahoma can lead to severe penalties. If you’re required by law to provide workers’ compensation insurance and you fail to do so, you can face a fine of up to $1,000 per day without coverage. The state can also close a business when it willfully fails to comply with insurance requirements.
Penalties aside, not having insurance means business owners are liable for workplace injuries and illnesses. If one of your employees gets hurt and you don’t have workers’ comp, you could end up paying for their medical bills and lost wages out of your own pocket.
What does workers’ comp cover?
If one of your employees is injured or becomes ill on the job, workers’ comp can cover their immediate medical expenses such as ambulance rides, emergency room visits, X-rays, surgery and prescription medications.
For example, if a kitchen employee reaches into a sink and slices their hand on a broken glass, they might require medical attention. Workers’ comp could cover the costs of their emergency room visit, stitches and pain management prescriptions.
Many work-related incidents can leave employees unable to work for several weeks or months. Workers’ comp can provide some relief for employees in the form of partial wage replacement.
If an employee breaks their foot in a work-related accident, they could end up stuck at home for multiple months. While they’re out of work, workers’ comp would cover some of their lost wages.
Some work-related injuries require long-term care such as physical therapy or pain management. Often, these injuries are more the result of repetitive workplace stress rather than a single traumatic incident. Chronic back issues for construction workers and carpal tunnel syndrome for office employees are two common examples of the types of workers who might receive ongoing care due to repetitive stress. If their claim is approved, workers’ comp can cover the costs associated with their ongoing care.
If the unthinkable happens and an employee passes away because of a workplace incident, workers’ comp can cover funeral costs and other death benefits for the deceased worker’s family or beneficiaries.