TennesseeWorkers' Compensation Insurance

Find the Best Workers' Compensation Insurance Options in Tennessee

There are about 603,000 small business owners in the state of Tennessee. Every company in Tennessee needs to consider having workers' compensation insurance to provide reimbursement for lost wages and medical expenses if a worker gets injured or ill due to their job duties or work environment. 

Additionally, workers' comp is often mandatory for most businesses across the country. In Tennessee, workers' comp is mandatory for businesses with five or more employees, with few exceptions.

Luckily, an independent insurance agent in Tennessee can help you find the right workers' comp for your business. They know exactly how much coverage to include in your policy. But until then, here's an overview of Tennessee workers' comp requirements and more.

Tennessee Workers' Compensation Laws

Tennessee's workers' compensation requirements can differ by a business's industry. But most businesses in Tennessee with at least five employees must have workers' compensation insurance by state law. 

Businesses without any employees usually aren't required to carry coverage. This includes sole proprietors.

How Does Workers' Compensation Insurance Work in Tennessee?

In Tennessee, workers' compensation insurance works by offering company benefits for employees who get ill or injured due to the workplace or job duties. These incidents can happen due to an unsafe work environment, repetitive job tasks, or the equipment used to perform the job. 

A portion of wage replacement is also offered by workers' comp when employees have to miss work to get treatments or recover. Prescription medications and doctor's or hospital visits can be covered as well.

With workers' comp as a part of a Tennessee business insurance policy, your business can be exempt from employee lawsuits related to covered incidents. Family members of affected employees also cannot sue the business. All this considered, having workers' comp insurance in Tennessee can protect your team and your business overall.

Tennessee Workers' Compensation Exemptions

There are some exemptions to Tennessee workers' comp state law requirements to be aware of in case your business doesn't actually need coverage. Tennessee workers' comp exemptions include: 

• Domestic employees
• Local or state government employees
• Farm labor workers
• Sole proprietors
• Business partners
• Limited liability company (LLC) members
• Independent contractors

A Tennessee independent insurance agent can help you determine if your business is required by state law to have workers' comp.

Do Independent Contractors Need Workers’ Comp Coverage?

Tennessee state law requires businesses with at least five employees to have workers' comp. There are only a couple of exceptions to this rule. However, independent contractors are also an exception.

In Tennessee, independent contractors aren't required by law to be covered by workers' comp. So, if you work as an independent contractor, you don't have to worry about workers' comp requirements or possible resulting penalties from not having coverage.

Do Tennessee Business Owners Need to Be Covered by Workers’ Compensation?

In Tennessee, business owners who are the only employees of their company aren't required by law to have workers' comp. So, perhaps the most obvious type of professional this applies to is a sole proprietor. However, just because you're not required by Tennessee state law to have coverage doesn't mean you shouldn't consider it.

Having workers' comp coverage can still help you save potentially thousands of dollars or even more. Just a single workplace incident could result in the need for costly medical treatment and time out of work. Without coverage, you could have to pay these costs out of your own pocket, which could financially harm you and your business.

What Does Tennessee Workers' Compensation Cover?

Tennessee workers' comp can pay for the costs of doctor's or hospital visits, medical treatments, medication, and other expenses. Covered incidents of injuries and illnesses to employees can result in many different types of expenses that workers' comp can help reimburse for. This coverage can also pay to replace a portion of affected employees' wages while they have to miss work for treatments or recovery.

In Tennessee, workers' comp can also cover funeral costs if a serious incident results in an employee's death. Having this coverage is also crucial since it exempts employees who get injured or ill or die due to a covered incident from filing lawsuits against your business for it. 

Further, the families of these employees cannot press charges against the business, even if the worker died, as long as workers' comp coverage was offered.

Here's a further breakdown of what workers' comp covers in Tennessee:

• Ongoing care: Workers' comp can help pay for required ongoing care costs to continue treating a covered injury or illness. For example, if a worker needs physical therapy due to a workplace injury, this coverage can help pay for that cost.
• Medical expenses: Workers' comp can help pay for medical expenses after covered incidents, including prescription medications. For example, if an employee needs a prescription for chronic pain due to their job tasks, workers' comp can pay for it.
• Time off during recovery: Workers' comp can help pay to replace some of an employee's wages while they take time off work to recover from a covered incident. For example, if an employee needs to stay at the hospital for two weeks after surgery due to a workplace incident, workers' comp can help continue some of the wages they would've made working during that time.
• Disability benefits: Workers' comp can also help pay for disability benefits, including temporary total disability benefits, permanent partial disability benefits, and permanent total disability benefits. If an employee qualifies for disability benefits due to a workplace incident, Tennessee workers' comp can help cover these costs.
• Death benefits: Workers' comp can also help pay death benefits for employees who die due to a covered incident. The death benefits are most often paid to an employee's surviving dependent family members or spouse.
• Funeral costs: Workers' comp can even help cover funeral costs for deceased employees due to a covered incident. Reimbursement can apply to burial costs, coffins, and more.

A Tennessee independent insurance agent can help review your policy with you so you can be sure of what your workers' compensation policy covers.

How Much Does Workers’ Compensation Insurance Cost in Tennessee?

The average cost of workers' compensation insurance in Tennessee is $48 per month or $576 per year. However, the cost of workers' comp insurance will vary based on many different criteria. The number of employees a company has and its annual payroll heavily impacts the cost of workers' comp.

The location and industry of a business also impact workers' comp costs. Since certain industries come with higher levels of risk, including those in the construction industry, insurance companies charge more for workers' comp coverage to compensate. Further, a business's prior claims history and the limits applied to its coverage also impact the cost of workers' comp.

How Can Tennessee Business Owners Save Money on Workers’ Comp?

There are a couple of ways a Tennessee business owner can save money on workers' comp. The "pay-as-you-go" payment option offers the benefit of a low upfront premium. It also offers the ability to just buy coverage based on actual payroll rather than projected or estimated payroll, which can greatly reduce costs. Another trick is to hire seasonal or casual employees to reduce premium costs.

Completing a safety program at your business can also help you bring down the cost of your coverage if you send proof to your carrier. Insurance companies like to see that your company has taken measures to reduce the risk of workplace incidents. Requiring your employees to complete a safety training is another way to possibly save money on workers' comp. 

What Are the Penalties for Not Having Workers' Comp in Tennessee?

Businesses in Tennessee that do not comply with state law for workers' comp can end up facing harsh penalties like fines. Tennessee has a strict schedule of fines for businesses that don't comply with state law. If a business in Tennessee doesn't provide proof of coverage, it can get hit with a fine of between $50 and $5,000.

Further, without workers' comp coverage, a business is vulnerable to employee lawsuits, or lawsuits filed by the family members of affected employees. The damages they sue a business for can amount to an excess of the protection workers' comp would actually provide. Not having workers' comp essentially makes a business vulnerable to many kinds of potentially huge financial losses.

How to Buy Workers' Compensation Insurance in Tennessee

Business owners in Tennessee have options for buying their workers' compensation. The first is to buy coverage through the voluntary market. The business owner can also choose to self-insure their company, provided they qualify. Another quick and easy option is for a business owner to purchase workers' comp online directly.

Note, though, that the easiest method of obtaining workers' comp in Tennessee is by working with a local independent insurance agent. These agents can shop and compare policies from many different Tennessee insurers for you. They'll get you matched to a policy with the best blend of coverage and cost.

Best Workers' Compensation Insurance Companies in Tennessee

Workers' comp is sold by many different insurance companies in Tennessee. However, you want your business to be equipped with the best coverage around. That's why we put together a list of some of the best options for workers' comp in Tennessee. Get started by checking out these top-quality insurance companies.

• Progressive: Progressive has been around for many decades and has an outstanding financial strength rating from AM Best. The carrier also offers 24/7/365 customer service.
• The Hanover: The Hanover got its start long ago, in 1852, and has excellent AM Best and Better Business Bureau (BBB) ratings. The insurance company also offers 24/7 claims reporting. 
• Travelers: Travelers is another longstanding carrier with excellent customer feedback. Travelers is known for affordable rates, many discount and endorsement options, and strong financial strength.
• Nationwide: Nationwide is a longstanding carrier with an excellent reputation thanks to its outstanding BBB and AM Best ratings. The carrier also offers 24/7 claims support. 

A Tennessee independent insurance agent can help you find the workers' comp your business needs from one of these outstanding carriers.

What Are the Best Workers' Compensation Companies in Tennessee?

Top Workers' Compensation Insurance Companies	Star Rating
Progressive
Hanover
Travelers
Nationwide

FAQs: Workers' Compensation in Tennessee