Workers’ Comp Insurance IL

An A-Z guide on everything you need to know before you purchase an Illinois Workers' Comp Insurance Policy

Like most states, Illinois requires that business owners provide their employees with workers’ comp insurance. The state is home to 1.2 million small businesses, which employ 2.5 million people in the state, which accounts for around 20% of the population and over 45% of the state’s entire workforce, all governed by the state’s workers’ compensation laws.

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Any business in a very high risk industry, must have coverage for everyone.

Who can be exempt?

  • Sole proprietors
  • Business partners
  • LLC members
  • Corporate officers

Is workers’ comp insurance required in Illinois?

Yes, Illinois requires any business in the state with employees to carry workers’ compensation insurance. However, there are options. Businesses can either purchase insurance through a private insurance provider or they can obtain permission from the state to self-insure. Note that self-insurance is usually only an option for very large firms rather than small businesses

Illinois also offers a few exemptions to the rule. For instance, if you are a sole proprietor, you are not required to carry workers’ compensation insurance. Business partners, LLC members, and corporate officers can exempt themselves from these requirements, too. Finally, if you’re an independent contractor, you’re not eligible for workers’ compensation in the state. 

Note that any business that engages in dangerous/high-risk work does not have these options. Construction and trucking firms are two good examples of these. Businesses within these types of industries must carry workers’ compensation coverage for everyone, regardless of their role within the business. That includes independent contractors.

Do you need workers’ compensation coverage if you’re self-employed?

Are self-employed professionals in Illinois required to carry workers’ compensation insurance? It depends on several factors. If you own a construction business, a trucking company, or are involved in another high-risk industry, then yes. If not, then you do not. That said, having workers’ compensation insurance is always a good idea, even if the law doesn’t require it.

Who is exempt from Illinois workers’ comp requirements?

Illinois only allows a few people to exempt themselves from workers’ comp insurance requirements. Those include sole proprietors, independent contractors, self-employed professionals, business partners, corporate officers, and LLC members.

How much is workers’ comp coverage in Illinois?

Your Illinois workers’ comp rate will depend on the following factors:

  • The type of business you have
  • The size of your payroll
  • Your safety record
  • Claim history
workers comp policy cost

How can Illinois small business owners save money on workers' comp?

While most business owners will have to pay for workers’ compensation insurance in Illinois, the good news is there are many ways to reduce that cost.

Employee Classification

One of the most important steps for business owners is to ensure that their employees are correctly classified. The wrong classification and job description could mean overpaying considerably for workers’ compensation. For example, an external sales rep has very different risk factors than an internal sales rep, so classifying both roles the same way would result in an overpayment.

Safety Programs

Business owners can create a formal safety committee made up of employees to administer a formal, documented safety program. Employees should receive instruction in the program, so they fully understand the requirements. 

Return-to-Work Programs

Employees deserve to be supported during their recovery. Return-to-work programs allow employees to resume working with light duties as they recover, before returning to their previous work level. 

No Tolerance

Drug and alcohol abuse are the primary causes of workplace accidents. Instituting a strict no-tolerance policy reduces risk levels.

Pay Attention to Your Ex-Mod

Your claims affect your Experience Modification Rate, which is compared to similar businesses. Pay attention to claims to help reduce your Ex-Mod.

How does workers’ comp work in IL?

Illinois workers’ compensation rates might differ from what a business would pay in another state, but the process involved works much the same across the entire nation. 

If an employee is injured on the job or while performing work-related duties, or develops an illness related to their occupation, they are eligible for workers’ compensation benefits. These benefits are designed to cover the cost of medical treatment, as well as to provide supplemental income while the employee is out of work.

What does workers’ comp cover in Illinois?

workers comp covers medical bills

Medical bills

Workers’ compensation coverage in Illinois includes a wide range of types, including emergency treatment, prescriptions, physical rehabilitation, and other medical care costs.

workers comp covers lost wages

Lost Wages

Workers’ comp coverage will also cover a portion of the injured workers wages so he can pay for his other expenses while he recovers.

workers comp pays death benefits

Death Benefits

It also includes coverage for permanent total disability, permanent partial disability, temporary total disability, temporary partial disability, vocational rehabilitation for workers unable to return to their previous roles, and death benefits in the case of fatal injuries.

How to get workers’ comp in Illinois

Obtaining workers’ compensation insurance in Illinois is not usually complicated unless the business is within a very high-risk industry. Otherwise, it’s best to purchase insurance from any reputable insurance company operating within the state. That said, not all insurance companies in Illinois offer workers’ compensation coverage. Kickstand Insurance provides workers’ compensation protection for businesses throughout the state.

What can happen if I don’t have workers’ comp insurance in Illinois?

Workers’ compensation coverage is legally required for most businesses in Illinois. Failure to comply with that law can result in a range of negative outcomes. The employer could face fines of $500 per day that it did not carry workers’ compensation insurance, with a minimum total of $10,000. 

If the failure to carry the requisite insurance is deemed negligent, the business could face misdemeanor charges. If the failure is considered willful and knowing, the business would face a felony charge, which is punishable by up to three years in prison and a fine of up to $25,000. Corporate officers can be required to pay fines if the business fails to do so.

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What are workers’ comp death benefits in IL?

If an employee is killed on the job or suffers a fatal injury and is covered by workers’ compensation insurance, benefits can be extended to the worker’s spouse, minor children, children under 25 who are full-time students, and children of any age with mental or physical handicaps. Death benefits will cover up to $8,000 in funeral costs. Weekly payments can be made for spouses and eligible children up to $500,000 or 25 years.

How do workers’ comp settlements work in IL?

In most cases, workers’ compensation settlements culminate in lump-sum payments. These can be set up as a wage differential claim, which allows the employee to return to work for less than their previous rate but receives supplemental benefits for a specified period, or a permanent and total disability claim.

What are the statutes of limitations regarding workers’ comp in IL?

Like all states, Illinois places stringent statutes of limitations when it comes to workers’ compensation claims. The employee must notify the employer within 45 days of the injury and the benefits claim must be filed with IWCC no more than two years after the last payment or three years from the date of the injury.

How do I get a workers’ comp insurance policy with Kickstand Insurance?

Start by filling out a short online form about your business. We’ll use that info to get you an estimated quote. Then, one of our experienced agents will contact you to review the quote and make sure you are getting the absolutely lowest rate possible for your business. Once the quote is finalized, you’re ready to buy the policy - often with coverage starting that day!

Why work with Kickstand?

Why make Kickstand your workers’ compensation partner? We can think of several reasons! We offer a streamlined process designed to ensure you have the coverage you need, along with the lowest rates available. We offer customized coverage tailored to your unique needs and goals, and our experts verify that your employees are properly classified to avoid overpaying.

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Ready to get started with Kickstand?

Time to take the next step? Just complete our online form – it’s just 5 minutes! Then we’ll provide you with a customized, no-obligation quote and connect you with one of our expert IL workers’ compensation insurance experts.