What if your company has no workers’ compensation insurance in California?
October 4, 2021

Carrying workers’ compensation insurance is a law in the state of California. While this alone is a great reason to make sure you have it, every business should have an insurance plan to protect themselves and its employees. Even small businesses that are trying to avoid the added expense will find that it’s beneficial to carry a workers’ comp plan. At Samuel Hale, we want to help you get the plan that you need to protect your company and your employees. We have a short guide that will help you understand what happens if you have no workers’ compensation insurance in California.

Jail time and fines

Before we get into the weeds of what the employee and company will need to do to resolve a work-related injury, we need to address the consequences. An employer that doesn’t have coverage can be penalized with a misdemeanor criminal offense with up to one year in county jail. Additionally, there’s a monetary penalty that’s up to double the amount of the worker’s comp premium that cannot be less than $10,000. What’s more, an employee who was injured while working for a company without insurance will have an increased benefit of up to 10%.

The employer pays for benefits

An employer who isn’t covered by insurance will be on the hook for paying out all benefits for the employee. This often includes medical bills that can continue to go on for many years and will quickly add up. Carrying workers’ comp insurance is a much more cost-effective solution to protecting your company and your employees. As with any insurance policy, you’ll be covered in the event of any injury that occurs as a natural part of the employee’s job. If the injury is not a result of normal work or the employee was not safely performing a task, your insurance policy will not have to pay out any benefits to the employee. However, it’s best to have a policy in place with an insurance adjuster who can decide that for you.

The responsibility falls on the employee

Keep in mind that an employee who works for a company that doesn’t carry workers’ comp insurance can still file for a claim. This often requires much more effort on their behalf as they’re not able to work with workers’ comp directly. Furthermore, your company could be facing a civil lawsuit as your employee seeks appropriate damages, which means that you’ll be forced to pay out appropriate benefits in addition to legal fees.

While you might feel like an employee who’s injured on the job will eventually let the case go and simply work with their primary health insurance, it’s likely that they’ll seek assistance from a lawyer who will see to it that their case is properly dealt with. Once again, a company that doesn’t have insurance will be responsible for paying all of the bills associated with the incident.

Contact us for advice

If you’re not sure about whether or not your company is required to carry a workers’ compensation plan, get in touch with our team at Samuel Hale. We’re more than happy to help you weigh the options of buying an insurance plan versus offering no workers’ compensation insurance in California. Give us a call today at 855-726-4253 or send a message to info@samuelhale.com. We look forward to hearing from you and helping you find the appropriate plan for your company and employees to create a healthy and safe environment.

What if your company has no workers’ compensation insurance in California?