In nearly every U.S. state, employers are required to carry workers’ compensation insurance. Since laws surrounding coverage are written at the state level, each state has different rules and requirements. Workers’ compensation is one of many small business insurance types all Virginia entrepreneurs should consider.

In this article, we’ll explain workers’ compensation laws in Virginia—who you need to cover, who is exempt, and possible penalties for non-compliance.


How does workers’ compensation insurance in Virginia work?


Most employers in Virginia purchase workers’ compensation coverage through private insurers or insurance brokers. Large companies with substantial capital resources and cash flow can qualify to become self-insurers. Some industries in Virginia also have group self-insurance options.


Who needs workers’ compensation insurance in Virginia?


In Virginia, employers must provide workers’ compensation coverage as soon as they have two full-time, part-time, or seasonal employees. Under Virginia state code, there are some occupations which are not considered employees and are thus excluded from workers’ compensation requirements. Those occupations include:

  • Officers and employees of the Commonwealth of Virginia
  • Licensed real estate brokers working under contract where the majority of compensation is from commission
  • Casual employees
  • Domestic workers
  • Agricultural workers for employers with less than 3 total workers
  • Amateur sports officials
  • Some taxicab drivers

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 Virginia?


The state of Virginia imposes harsh penalties for employers who fail to provide workers’ compensation coverage. Civil penalties for non-compliance can reach $250 per day for a maximum total fine of $50,000. Failure to carry insurance is also considered a misdemeanor offense, carrying a fine of up to $1,000 and up to six months imprisonment.

Employers are also open to risk of civil lawsuits if an employee sustains a work-related injury while uninsured. Such lawsuits can result in employers paying substantial amounts for medical costs and lost wages. Going without insurance can end up costing exponentially more money than simply paying monthly premiums.


How much does workers’ comp insurance in Virginia cost?


On average, employers in Virginia pay $0.74 annually per $100 in covered wages.


What does workers’ comp cover?

Medical costs

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.

Lost Wages

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.

Ongoing Care

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.

Death Benefits

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.