KY Workers’ Comp Insurance

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

If a Kentucky-based business employs one or more people, it’s required to purchase workers’ compensation coverage. The state does not distinguish between full and part-time employees for the purpose of workers’ comp.

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Even 1 part-time employee would need a workers' comp policy

Who can be exempt?

  • Domestic workers in private homes
  • Residential repairmen employed for 20 or fewer consecutive days
  • Religious organizations
  • Federal workers
  • Agricultural businesses

Is workers’ comp insurance required in Kentucky?

Yes, most businesses will require KY workers’ comp insurance. The state mandates that any employer with one or more employees, regardless of full-time status, purchases a workers’ comp policy. 

Do self-employed professionals need KY workers’ comp insurance?

No, Kentucky does not require that self-employed professionals or independent contractors have workers’ compensation insurance. However, the state can decide that a self-employed professional is actually an employee depending on how the business/employer treats them. If this occurs, the business must add the individual to its workers’ comp policy or face penalties. 

Who is exempt from Kentucky workers’ comp requirements?

The state does allow quite a few exemptions, including Domestic workers in private homes, Residential maintenance or repair people employed for 20 or fewer consecutive days, Religious organizations, Federal workers, and Agricultural businesses.

In addition, Sole proprietors, Business partners, LLC members and Corporate officers can elect to exempt themselves.

How much is workers’ comp coverage in Kentucky?

Your Kentucky 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 Kentucky small business owners save money on workers' comp?

Providing workers’ compensation coverage shouldn’t break the bank. Small businesses can use several proven tactics to reduce the cost of KY workers’ compensation coverage. These include the following:

How does workers’ comp work in KY?

The process you’ll follow with KY workers’ comp insurance is relatively straightforward. 

  1. Purchase insurance based on your estimated annual payroll
  2. Pay your premium
  3. Obtain coverage
  4. Enjoy coverage for one year
  5. Complete a year-end audit to verify payroll accuracy
  6. Receive a reimbursement for overpaying or pay the difference if underbilled

What does workers’ comp cover in Kentucky?

Workers who file a workers' comp claim in Kentucky can receive benefits for the following:

workers comp covers medical bills

Medical bills

workers comp covers lost wages

Lost Wages

Workers' comp coverage also protects employers from legal action. This means that if an employee sues your business because of a workplace injury, the insurance will cover the legal costs of the case.

How do I purchase KY workers’ comp insurance?

Need to purchase workers’ comp coverage in Kentucky? You’re in luck. The process is simple. 

  1. Buy a policy through a private insurance company. This is the most commonly followed path for low to moderate-risk businesses. Get an online quote in seconds with Kickstand Insurance.
  2. Use the state fund. This is the option for high-risk businesses that cannot purchase KY workers’ comp insurance through a private insurance company.
  3. Go the self-insurance route. This is an option for large businesses with enough money to pay for an injured worker’s medical costs, lost wages, and other costs out of pocket. 

What are the penalties for not carrying KY workers’ comp insurance?

Failure to carry workers’ compensation insurance in Kentucky can mean facing several potential penalties, including the following:

  • $1,000 per employee per day without coverage
  • Stop work order
  • Criminal charges, including fines and jail time
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What death benefits are mandated with KY workers’ compensation insurance?

Under Kentucky law, a deceased employee’s spouse and other dependents may be eligible for death benefits. Eligible dependents may see up to 75% of the employee’s average weekly earnings for up to 500 weeks. 

The family is also eligible for funeral-related expenses based on the state’s average weekly wage, which changes annually. However, for this to apply, the employee must have died within four years from the date of the injury.

How do workers’ comp settlements work in KY?

Like many states, Kentucky allows employees, employers, and insurance companies to come to an agreement called a settlement. These are usually in the best interests of everyone involved and the employee will see a lump sum payment. 

However, while most states require that the employee waive all rights to future claims stemming from the injury, Kentucky does not. The state allows the case to be reopened if the employee’s condition worsens within four years of the settlement. 

Note that all settlements must be approved by the state’s Department of Workers’ Claims, but a formal hearing may not be necessary.

What are the statutes of limitation regarding workers’ comp in KY?

Employees have just two years to file a workers’ comp claim in Kentucky. That timeline is based on the date of the accident or injury or the date the employee became aware of the disease/disability, whichever is later. 

What does KY workers’ compensation insurance pay for?

In most cases, a workers’ compensation policy will cover an employee’s medical costs, lost wages, and more. 

Here’s a breakdown of what’s usually covered:

  • The costs of emergency care to treat the injury at the time it occurs
  • Medical costs that stem from the injury, such as corrective surgery
  • The costs of medications and other requirements stemming from the injury
  • Rehabilitation after medical care
  • Temporary total disability, permanent partial disability, and permanent total disability benefits
  • Death benefits for the spouse and surviving dependents/qualifying family members

How does KY workers’ compensation insurance protect employers?

Too often, employers look at workers’ compensation as a cost without a benefit. 

The truth is that these policies protect employers just as much as employees. Without a workers’ comp policy in place, the employer could be on the hook for paying medical costs and other related costs out of pocket, rather than having the insurance company pay those costs.

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!

Learn more about Workers' Comp in Kentucky

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