There’s no denying that working for yourself has its perks. Although being classified as self employed or an independent contractor can give you increased freedom and flexibility with your work, it could also potentially put you at risk if you don’t take the proper precautions. As an independent contractor, you are often forfeiting many rights that an ‘employee’ status could give you. One of the main benefits given to employees, workers’ compensation coverage, is often not automatically granted to self employed individuals or independent contractors. However, there are instances in which you are eligible for or required to have workers’ compensation insurance. 

Am I an Independent Contractor or Employee?

In order to determine if you should be covered under workers’ compensation insurance by your employer, you must first understand how you classify as a worker. As a general rule of thumb, an employee normally fills out a W-2 tax form while a contractor fills out a 1099. If you are an employee, most states require your employer to hold some level of workers’ compensation insurance to protect you in case of a workplace injury or illness. If you are a contractor or self employed, it is likely that you do not receive this same coverage. The laws regarding workers’ compensation for independent contractors vary per state so it is important to take the time to understand what protections you are entitled to as an independent contractor. 

Should I have Workers’ Compensation Insurance? 

If you are not granted workers’ compensation due to the classification of your job responsibilities, you are often able to purchase workers’ compensation insurance for yourself. There are a number of reasons why you may choose to do this including: 

Protect Yourself Against Unforeseen Physical and Financial Trouble: If you are injured while performing job duties, you will likely have medical bills to pay and may even be unable to work for an extended period of time. Workers’ compensation protects against the hardships that accompany a work-related accident or illness so the effects are not detrimental to both your health and career. 

Adhere to a Contract: Sometimes, a company will require the independent contractors they hire to have workers’ compensation insurance to protect against any injuries that could potentially occur while they are working. This primarily protects the business from a lawsuit in the event that an independent contractor is injured while fulfilling their contract.

Although there are some instances in which you should consider purchasing workers’ compensation for yourself, a large number of job responsibilities and classifications should be covered under a company’s workers’ compensation insurance. If you are concerned that you may not be receiving the coverage you are entitled to, contact Poirier Law Firm. Now is the time to ensure that you have the rights and protections you deserve. 

Source: https://www.insureon.com/small-business-insurance/workers-compensation/self-employed-independent-contractors