Edited by: PolicyApe_Admin and Reviewed: PolicyApe_Admin
Having insurance is an important part of running a business. However, if you don’t regularly have employees, you might not need workers’ compensation all the time. But you may need it if you have an event where you hire extra staff to assist. In cases like these, you’ll want short-term workers’ compensation insurance.
The difference between short-term workers’ compensation and a traditional workers’ compensation insurance policy is the duration. Both cover employees for the same risks, but short-term workers’ compensation insurance is only for a limited time while you have temporary employees. Often, these policies are for events or special circumstances where you don’t plan on having employees for an extended period of time.
Let’s look at the key features of short-term workers’ compensation insurance that employers can get to protect against work-related injuries.
The coverage period for short-term workers’ compensation insurance is usually for several hours, days, or weeks rather than for an entire year, as a traditional policy would be.
A short-term workers’ compensation policy will be bought by employers to cover employees with the following coverages:
A business with temporary employees is eligible for short-term workers’ compensation insurance.
A business that hires employees for a short period of time will need short-term insurance. Common examples include a DJ who hires an assistant for an event. The assistant is only working the hours of the event, and this is the only time workers’ compensation is required. Another example is a farmer who hires temporary employees to harvest the crop. The insurance is only needed during the harvest. Yet another example is that of a cleaning business that needs a policy for short-term help.
Employers must follow state laws when getting insurance. Just about every state requires workers’ compensation insurance for employees. The requirement is that insurance must be in place for employers before the first employee starts. Employers should get a policy that covers the employee in time.
Getting a short-term workers’ compensation policy is a cost-effective way to get insurance coverage. Ultimately, the costs of short-term workers’ compensation insurance are less than traditional policies. The employer is able to protect the company only for the risk time that exists and doesn’t need to maintain a policy during periods when there are no employees. This type of flexibility allows to better manage budgets while providing 100% of the required coverage for employees when necessary. Having a policy in place allows employers to have a quick response to work-related injuries.
Getting short-term workers’ compensation insurance requires finding an insurer who will write a policy for a limited timeframe.
Let’s take a look at the application process.
You’ll need the payroll data and dates and times of events needing insurance to get a policy. You’ll also need your business details, such as the address and phone number of the contact person in charge of the insurance.
Complete the application form in its entirety to get a policy. You’ll need to include the type of work the employee does to complete the form. Make sure to enter correct and accurate information for proper underwriting and protection.
Make sure that you understand the policy details. Know what the policy limits are. Most policies start at $100,000 in coverage but can go much higher if you want them to add protection.
There are some challenges to consider.
Employees with pre-existing conditions will still be able to get coverage; however, their protection may be limited by their pre-existing conditions. The insurance will not continue to pay if the employee was hurt prior to working unless they somehow aggravated or worsened the injury with the work done.
The insurance company will handle claims and deal with disputes and resolutions. It is important for employers to work with insurance companies to provide timely and accurate details about incidents where an employee was injured.
Employers should maintain continuous coverage for employees who work for them. There should be no gaps in coverage as this may violate state law and leave the employer at risk of getting sued if an injury happens.
The cost of the short-term policy will depend on the type of work done by the employee, the policy’s duration, and the employee’s payroll. Employers will also pay more for policies that have higher coverage than others.
The only difference between long-term and short-term insurance is the duration. Short-term insurance protects employers for a limited period of time, usually an event or short season.
Business interruption is not covered by short-term workers’ compensation insurance. Employers would need a separate policy, like a business owner’s policy, to get that coverage.
Typically, workers’ compensation insurance does not cover employers for their injuries. However, some policies may if they are set up properly. Speak with your insurance agent to know for sure.
Contractors hired by general contractors may be required to get workers’ compensation to fulfill contractual obligations. It may be a contingency to get the gig.
If you need a short-term workers’ compensation policy, our resources can help. Check with our partners to see who writes short-term policies and get a quote today.
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