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Client requirements for workers' compensation insurance

It's not unusual for a client to require their tech contractors to carry workers' compensation insurance. Learn what to expect from a client contract, including how much you can expect to pay for this policy.

What can you expect in a client contract that requests workers' compensation?

When a client asks you to purchase your own workers' compensation insurance, they're trying to keep their costs low while ensuring they’re in compliance with state requirements.

The specifics vary from one case to the next and no two client contracts are alike. But given the variations that are bound to occur, here’s a general idea of what you might see in a contract:

$500,000 in workers’ compensation benefits. This is a common coverage limit we’ve seen in contracts for technology companies. Many state laws require that much coverage for each worker. But laws differ from one state to another.

Option to waive coverage if you have no employees. We see this regularly in the requirements companies outline for their IT contractors. If you're working as a contractor and have no employees, your contract may state that you don’t have to carry workers’ comp. Again, that likely aligns with state laws. Many states give sole proprietors with no employees the option of not covering themselves.

A median premium of $36 per month. Several factors affect costs, including the specific kind of work you’re doing, the environment you’ll be in, and the state where you’re operating. (Read more about workers' compensation insurance costs.)

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How can you meet a client's workers' comp requirements?

Once you have a client contract in hand, you can secure workers’ compensation coverage in one of several ways. You can:

Your insurance agent will help you determine whether the policy you’re considering meets the requirements for workers' compensation in your contracts. Be sure to share those needs with your agent as soon as possible. Knowing what you need makes it easier for your agent to recommend the policy that makes the most sense.

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