In MO if you have 5 or more employees (or just one employee for construction employers) you are required to have Work Comp coverage or face significant penalties from the State. Owners/Officers be sure to count yourself as an employee when coming up with your total.
Small contractors are notorious for not carrying work comp coverage. This makes it difficult for the honest Business Owners to compete since their overhead is greater than the contractor that is cutting corners.
We hear it from our smaller contractors fairly often – they are solid Business Owners (true professionals) and they have the monthly expense of a work comp policy, so they have to include this in their bid (as cost of labor). The Work Comp premium for interior work is not too bad, but, if they are doing siding or roofing, it really adds up [due to industry wide claim volume and injury severity – the companies have to collect a premium sufficient to cover the cost of claims (medical bills, payments for loss of income, legal costs and settlement payments)].
The contractors that are operating without Work Comp are more than likely operating without General Liability Coverage also. If you are a homeowner/business owner that will be hiring a contractor, and they can not produce a Certificate of Insurance, forget them, because you’ll be assuming a significant unknown exposure - for more information check this post: Homeowners and Contractors - Make Certain you are not exposed
I got off topic, but even if you are not not required to participate in the Work Comp system you should still have the protection. With a policy, you will not have to face a Civil Suit that will follow if an employee is injured on the job. Even if it is a bogus claim, the Insurance company has the “duty to defend” you - e.g. potentially significant court/legal costs will be absorbed by the Work Comp Carrier – not you!
I’ve heard things like, “It’s just my buddy, working for me, I’ll be fine”. Don’t think for a second, if your “buddy” sustains a significant injury on the job, that puts him out of work for an extended period of time, with no income and he may not have health insurance, that he’s not going to eventually seek some sort of avenue of restitution – and if he doesn’t I’ll almost guarantee his wife will and rightfully so, especially if he has kids to feed.
I have the pleasure of residing in a sheltered business environment blanketed by only intelligent, charming, well adjusted, attractive Hebbeln clients! Every single one of them – it’s wonderful!!
Unfortunately , Outside of this haven, I’ve noticed a fair amount of the populous is delusionally and annoyingly self-entitled. The injured buddy in the story is not one of them - he truly is entitled to benefits, so if he is a buddy, make certain to protect him and your business at the same time.
How bout that picture?! That guy either really got hurt or that's some performance - like Brando "On The Waterfront" good - no?
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