Who Needs to Carry Workers’ Comp Insurance in Maryland?

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

Every business that employs at least one person in the state of Maryland is required to carry workers’ compensation insurance. The state does not discriminate between full-time and part-time employees, either. However, there are exceptions you should know about.

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Even a part-time employee will count as an employee and require a policy.

Who can be exempt?

Agricultural businesses with three or fewer employees
Agricultural businesses with less than $15,000 in payroll annually
Sole proprietors
Partners
Independent contractors

Is worker’s comp insurance required in Maryland?

In a nutshell, yes, most Maryland businesses will need to purchase a workers’ comp insurance policy. Under the state’s laws, any business with one or more employees is required to do so.

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

No, Maryland does not require that self-employed, independent contractors carry workers’ compensation insurance.

Who is exempt from Maryland workers’ compensation requirements?

Agricultural businesses with less than 4 employees or less than $15,000 in payroll annually are exempt. In addition, self-employed, independent contractors, sole proprietors, and business partners are also not required to carry workers’ compensation insurance. LLC members are a little different. Those who provide a service for monetary compensation are statutorily covered. However, if an LLC member owns more than 20% interest in the LLC, they may choose to exempt themselves.

How much is workers’ comp coverage in Maryland?

While workers’ compensation insurance will come at a cost, it does not have to be exorbitant. The average workers’ comp rate in Maryland is $3.25 per $100 of payroll.

Your Maryland 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

You can learn more about Maryland workers’ comp rates here.

workers comp policy cost

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

There’s good news for business owners who realize the importance of carrying workers’ comp insurance but are concerned about their overhead. You can save money on your policy in a few ways, including:

Ensure all workers understand and follow OSHA workplace practices
Create and implement a workplace safety program
Create a drug and alcohol-free workplace program
Verify that your employees are correctly classified

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How does workers’ comp work in MD?

Employers must understand how workers’ comp operates in Maryland. The process is relatively simple.

First, you’ll need to purchase a policy. It will be based on your estimated annual payroll.

Next, you pay the premium, which begins your coverage. You and your employees get protection for one year.

At the end of the year, you’ll go through an audit to see if you overpaid or underpaid. Depending on the results of that audit, you’ll either get a bill or a reimbursement check.

What does workers’ comp cover in Maryland?

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

workers comp covers medical bills

Medical bills

workers comp covers lost wages

Lost Wages

workers comp pays death benefits

Death Benefits

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 to get workers’ comp insurance in Maryland

You have three options to purchase workers’ comp insurance in Maryland.

Most businesses choose to purchase workers’ comp insurance from an insurance company. Kickstand Insurance can help you find the right policy for your needs.
Some businesses may need to purchase insurance from the state fund.
Very large employers can choose to self-insure, but Maryland has very specific requirements you’ll need to meet.

What are the consequences of not carrying workers’ comp insurance in Maryland?

Like several other states, Maryland has stiff penalties for employers who decide to flout workers’ compensation laws. If you fail to maintain your insurance, your business could face fines of up to $10,000.

Corporate officers can also be held personally liable for the cost of those fines. Employers that try to deduct any portion of workers’ comp insurance costs from employee pay could be charged with a crime.

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What are workers’ comp death benefits in MD?

Workers’ comp insurance is designed to pay death benefits to the surviving family members if an employee dies of a work-related injury or disease. Maryland requires that any family member who was dependent on the employee’s income to have a claim on those rights.

Each dependent has a right to two-thirds of the employee’s average weekly income based on the percentage of that income’s contribution to the household’s entire income. So, if an employee’s earnings paid for 50% of a household’s bills, then a survivor could receive 50% of two-thirds of the average earnings.

Death benefits can last a maximum of 12 years (and a minimum of five) and will pay up to $7,000 in funeral costs.

How do workers’ comp settlements work in MD?

Workers’ comp settlements are mutual agreements between the employee, employer, and insurance company. In Maryland, it is a full and final resolution to the claim.

All workers’ compensation settlement agreements must be approved by the Maryland Workers’ Compensation Commission.

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What are the statutes of limitation for workers’ comp in Maryland?

Employees are required to report their injury to their employer within 10 days and claims must be filed within 60 days of the injury or discovery of an illness.

However, employees have two years from the date of the injury under state law.

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How does workers’ comp insurance protect employers?

While workers’ compensation works to protect employees, it also safeguards employers.

Without workers’ compensation insurance, employees injured on the job or who developed a work-related illness could sue the employer directly for the costs of their medical care, rehabilitation, prescription medications, and other costs.

With workers’ compensation insurance, the insurance company pays 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!

Ready: Fill out an online form. It only takes 5 minutes!
Set: One of our agents will contact you to review the quote.
Go: You can get covered starting today!

Why use Kickstand to
get workers' comp insurance?

Speed + Service + Experts

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Unlike other online insta-quote systems,
here your quote is reviewed by experts

Why does it matter?

Avoid surprise bills at audit
Make sure all your employees are properly covered
Protect yourself from lawsuits

What do we check?

Business categorized correctly
Employees job roles
Special discount opportunities

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