Understanding Workers’ Compensation for Electricians

Few professions are as necessary as electricians.

Where would the world be without them? Electricity powers homes, keeps people warm, and generally runs everything. With that said, it’s a dangerous job. It carries a great many risks. Some are obvious, while others won’t occur to the common person.

All of those risks mean that workers’ comp for electricians is an invaluable resource. Accidents happen, even to the most cautious workers, and an electrician’s workers’ compensation keeps them covered if an injury occurs. 

Workers' compensation for electricians protects workers in the event of a workplace injury or illness. It covers lost wages, medical expenses, funeral expenses, and potentially other costs. Rules and regulations vary from state to state.

Generally speaking, most industries and businesses carry workers’ comp insurance. In some cases, insurance is state-funded. Most states require businesses and companies to purchase workers’ comp insurance from private carriers, however. 

Several factors determine the premium costs of workers' compensation for electricians. For high-risk positions like electricians, it is vital to meet specific requirements and provide accurate information to insurers. 

What Are the Risks of Electrical Work?

Electricians frequently come into contact with hazards. It’s the nature of the job and can’t be avoided entirely, so an electrical contractor's insurance company will always take that into account. In addition to exposure to numerous hazards, the severity of certain types of injuries may be severe. Electric shock carries more risk than a file clerk tripping in an office, for example. 

The most common injuries for electricians are electric shock, electrical burns, thermal burns, and falls. With any of these injuries, there is a potential for long-term damage to different systems in the body. Even with proper equipment, an electrician isn’t completely protected from things like burns. Accidents happen and sometimes no one is at fault. 

Many electricians are frequently exposed to height risks, too, especially if they work on power lines. Working at great heights presents a set of risks all its own and factors into the premium calculations of workers' compensation for electricians.

What Does Workers’ Compensation for Electricians Cover?

Workers’ compensation for electricians primarily covers lost wages and medical expenses. “Medical expenses” means a wide range of things, however, and no two injuries are alike. Individual states have different mandates dictating how long workers’ compensation lasts, the amount it pays out, and what it covers. Workers’ compensation generally helps employees with:

Long or Short-Term Medical Costs - If an employee sustains an injury or illness on the job, workers’ compensation for electricians covers the associated medical costs as long as they’re related to the incident. For some employees, that consists of a single hospital bill and a prescription.

For others, workers’ comp covers treatment for the rest of their lives. As an example, if an electrician sprains their foot on the job, workers’ compensation covers the cost of evaluation, scans, and treatment. It’s a short-term injury with (ideally) a short-term resolution. If an electrical contractor suffers a severe electrical burn, however, they could have related medical issues for years. In both cases, workers’ compensation insurance gets the electrician the care they need.

Lost Wages - The wage replacement rate varies by state. On average, lost workers’ comp covers wages at around two-thirds of the employee’s average weekly salary. Some states have higher or lower rates and differ on when coverage kicks in.

In Florida, wage replacement begins after seven days of missed work and in Massachusetts’ coverage begins after five days.

Funeral Costs - In the unfortunate event that an employee dies as a result of a workplace accident, workers’ compensation covers funeral costs and pays out benefits to the deceased’s spouse or dependents. 

The above is a brief, non-comprehensive look at just a few types of coverage employees have under workers’ compensation. Maintaining coverage is incredibly important for electricians (and any type of employee). No one knows when the unexpected will happen.

Electrical Contractor Insurance Requirements

What insurance does an electrical contractor need? Every state has guidelines for workers’ compensation insurance. It’s unlikely that any electrical contractor or electrician could be exempt from them.

Additionally, electricians must carry other types of insurance (like general liability or professional liability insurance), but only workers’ compensation for electricians is specifically geared toward covering employees and electrical workers. 

If protecting employees isn’t compelling enough to purchase workers’ comp insurance, there are consequences for violating the associated laws. If a company fails to insure its workers, they face penalties that may amount to tens of thousands of dollars. Other potential outcomes include:

Stop Worker Order - A Stop Work Order (SWO) means that any operations cease immediately. SWOs are usually used for construction sites, but they’re one possible penalty for workers’ compensation violations.

Lawsuits - If a business doesn’t carry workers’ comp insurance or an employer handles procedures poorly, they may be sued. Filing workers’ compensation claims occurs within a specific window of time (depending on your state) and failure to file means a potential lawsuit.

Fines - Failing to carry workers' compensation for electricians or filing a claim outside the correct window of time means fines. They accumulate quickly and start to really add up. 

All in all, the potential costs of not getting workers' compensation for electricians will probably outweigh the cost of premiums. It’s a major risk to take and leaves workers and the business at risk. 

How Are Costs Calculated?

With that said, electrician workers’ comp insurance cost is potentially intimidating. An equation factoring in payroll information and class codes determines premium rates. For well-paid, high-risk positions like electricians, costs may increase. 

What Are Class Codes? 

Class codes, or comp codes, are set by the National Council on Compensation Insurance (NCCI). They designate the risk associated with a position. Exposure to hazardous material, increased likelihood of injury, working with heights, and so on all indicate higher risk. Insurance companies do not make comp codes, but they use them to calculate premium costs. Electricians and electrical workers have a handful of common comp codes. 

• 5190 (Electrician/electrical contractor)
• 5190 (Installation of electrical wiring systems within buildings)
• 5190 (Low voltage electrical work)
• 7605 (Burglar And Fire Alarm Installation)
• 9516 (Home Theater Equipment - Installation, Service, or Repair)
• 7538 (Utility and power line work) 

Definitions of comp codes differ slightly between states and insurance companies weigh costs differently. 

Tips for Lowering Costs

Workers’ compensation for electrical workers is likely expensive. There is no getting around that completely. The duties are inherently high-risk, whether someone is performing power line work or doing electrical maintenance inside homes. There’s variation (that’s what the class codes are for) but costs never match those of a secretary or data entry clerk. 

There are ways to lower premium costs for electrician insurance, though. Many of them come with the added benefit of having well-trained workers.

Have a Safety Program

Having a formal, clearly written safety program for the insurance underwriter makes a difference. Address typical or frequent safety concerns, like training on scissor lifts, booms, ladders, and any other big equipment. 

Complete Information 

The more information you have, the better. Underwriters like knowing everything. For electrical work, learn the maximum voltage typically worked with. Leaving out information results in higher premiums - at that point costs are based on the unknown, and underwriters will assume the worst. Sharing more information means more accurate pricing and possibly lower costs. 

Safety Training 

Along with the written safety program, follow through with training. Health and safety training programs result in a well-prepared workforce and keep employees aware of risks, responses, proper use of equipment, and other ways to prevent injury and illness. 

Where to Purchase Insurance

Not every insurance company offers workers' compensation for electricians. Some are unwilling to take the risk, and underwriters turn them away because of the high likelihood of accidents or injuries. Some workers’ compensation programs are state-funded, but many states require companies to purchase their own plans. That’s complicated if companies turn away high-risk jobs. 

If you’re struggling to get the coverage you need for your business and employees, Kickstand Insurance can help. Kickstand offers electrical contractors insurance services and works with a wide variety of other industries. High-risk jobs are just part of it. Those employers and employees need coverage, too, and Kickstand’s dedicated team provides it.

The process is easy. Apply online and get a quote in just a few minutes. Follow all the tips and tricks above for accurate rates. If you need coverage fast, Kickstand is the answer. You’ll have a certificate in hand as soon as 24 hours after the policy is bound. Get expert help with figuring out classifications, protecting yourself and your business from lawsuits, and keeping all of your employees covered. Even better - Kickstand Insurance checks for discount opportunities to lower your premiums further. 

‍Workers’ compensation insurance is too important to ignore. No matter where you’re located, it’s a necessity. Don’t leave your employees and your business without coverage when you can get a quote and a policy in place in mere minutes.