Workers’ Comp Insurance North Carolina

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

Almost 1 million small businesses call North Carolina home. Those companies account for 99% of the businesses within the state and employ over 1.7 million people. The state’s workers’ compensation laws play an important role in keeping those employees safe while also protecting businesses.

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A corporation’s officers, nonprofit directors & executive officers are counted as employees for coverage minimum

NOT counted as employees for coverage minimum

• Sole proprietors with no employees

• members of LLCs,

• partners

Is workers’ comp insurance required in North Carolina?

Companies with three or more employees must have a workers' comp policy, including part-time employees unless they fall into one of several exemption categories. 

The state does not count sole proprietors with no employees, members of LLCs, or partners as employees, and these people are not required to have workers’ compensation insurance. A corporation’s officers can choose to be excluded or to have coverage, but still count as employees either way. The same rule applies to nonprofit directors and executive officers.

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

Self-employed individuals do not have to have workers’ compensation insurance if they fall into one of the categories discussed above. However, it’s always a good idea to purchase coverage, even if you’re self-employed.

Who is exempt from North Carolina workers’ comp requirements?  

If you’re an independent contractor, you’re not required to have coverage. However, the state’s laws regarding independent contractors are somewhat murky, so make sure you know you qualify before deciding not to purchase workers’ compensation insurance in North Carolina.

The following are exempt from having a policy:

  • Agricultural salespeople who work on a commission basis
  • Employees of the federal government
  • Household domestic staff
  • Casual employees who are not technically part of the trade/profession
  • Certain railroad workers 
  • Employees of the federal government

How much is workers’ comp coverage in North Carolina?

Your North Carolina 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 North Carolina's workers’ comp rates here.

workers comp policy cost

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

Struggling with high workers’ compensation insurance costs? You’re not alone. It’s a major factor for many business owners and decision-makers in North Carolina. 

There’s good news. Many business owners don’t realize that it’s possible to reduce the costs of workers’ comp insurance without sacrificing coverage or putting their businesses in legal danger. Here are a couple of ways you can make coverage more affordable:

  1. Verify your employees are classified correctly. An incorrect class code or job role could mean a big difference in your annual premiums. Employee classification can be very nuanced, so it’s important to have an expert working with you.
  2. Develop a safety program for your workplace. Include daily and monthly meetings and involve your employees in the safety team. 
  3. Make sure everyone understands and follows OSHA safety guidelines. These should be posted within the workplace, too.
  4. Create a return-to-work program that will help employees come back from an injury while still earning a paycheck while performing light duties.
  5. Ask your agent about dividends. Work with an expert agent to obtain year-end rebates that can save you 5% or more on your premium post-audit.

How does workers' comp work in NC?

The rate you pay for workers’ comp coverage will vary based on payroll size, industry, and state. However, the process is similar in all states. 

  1. You buy a policy. You’ll be asked to estimate your annual payroll at this time. This will form the basis of your costs. 
  2. At the end of the policy term, usually 12 months, your insurance company will audit the payroll to make sure your costs were accurate. If your payroll was less than you estimated, you’ll get a refund. If it was more, you’ll be billed for the additional premium. 

One of the most important tips for controlling workers’ comp costs is to keep accurate payroll records and tax documents all year long. That helps ensure you get the most money back at the end of the year and that you can avoid paying more money.

What does workers’ comp cover in North Carolina?

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

workers comp covers medical bills

Medical bills

Medical care from a covered provider

workers comp covers lost wages

Lost Wages

Disability benefits for employees not able to return to work

workers comp pays death benefits

Death Benefits

Death benefits for spouse/family

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 North Carolina

Obtaining worker’s comp insurance in North Carolina is as simple as buying a policy from a trusted insurance agent licensed to work in the state. Kickstand Insurance offers affordable coverage for North Carolina employers. While small and medium sized  businesses (SMBs) need to purchase from an insurance company, large companies may be able to self-insure.

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

Workers’ compensation insurance is mandatory for businesses that don’t fall within one of North Carolina’s exemptions. If you fail to purchase coverage, you are in danger of suffering a wide range of penalties, including:

  • $1 per employee per day fine (maximum $100 per day), with a maximum of $36,500 per year
  • Felony charges if the failure to secure coverage is deemed “willful”
  • Responsible for the costs of medical treatment and lost wages if an injury occurs without workers’ comp coverage
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What are workers’ comp death benefits in NC?

While most states offer some form of workers’ comp death benefits, North Carolina’s are more flexible than some. For instance, under the Pickrell presumption, even deaths from unknown causes and circumstances can mean benefits for an employee’s survivors. 

The state also presumes the spouse and any minor children were wholly dependent on the employee’s income, but the benefits can also go to partially dependent individuals, including adult children and next of kin. The state’s weekly death benefit is two-thirds of the employee’s weekly earnings paid for a minimum of 500 weeks or until a minor child turns 18. Burial expenses are also included up to $10,000.

How do workers’ comp settlements work in NC?

Employees may choose to settle their worker’s compensation case. That offers immediate cash to pay for mounting medical bills and helps avoid a court case, which might delay benefits for a very long time. It also benefits the employer. 

In this situation, the employee would sit down with the insurance company and its lawyers, as well as a representative of the employer, to find a solution that benefits everyone. The state allows compromise settlement agreements, Form 26A settlements, and Form 21 settlements.

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

Like most states, North Carolina has a two-year statute of limitations from the date of the injury. An injured employee must file Form 18 within that time, or their claim will not be processed.

However, employers are also required to immediately report work-related illnesses, injuries, and accidents to their insurance carrier. If the employee’s medical costs are more than $2,000 or they must miss more than one day of work, the employer or the insurance company must file a report with the state’s Industrial Commission no more than five days from the date of the accident/incident. 

The report must also be given to the employee, who must also be given a blank report to use to file a claim.

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 North Carolina

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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