Workers’ Compensation Insurance in Kentucky

What are the legal requirements for workers’ comp in Kentucky?

Kentucky’s workers’ compensation law is unique with respect to its breadth of coverage for all workers. While some groups are excluded from employer-provided workers’ comp coverage — agricultural employees, some domestic workers, truly independent contractors, employees covered by federal acts, and certain religious organizations — all employees may still be covered under the Kentucky Uninsured Employers’ Fund. 

What does workers’ comp insurance cover in Kentucky?

In the event of a workplace accident, Kentucky workers’ comp insurance provides coverage for medical treatment,  temporary or permanent disability benefits for lost wages, and death benefits when an employee dies. 

The injuries and occupational diseases compensable with workers’ compensation benefits are limited to physical injuries and mental injuries which directly result from those physical injuries.

What are Kentucky’s temporary disability benefits?

Temporary workers’ comp benefits refer to when your employee is unable to work for more than one week — in these cases, the injured employee is able to receive compensation for the lost wages, which are called “lost time benefits.” Your employee’s doctor must certify your employee is not able to work before the temporary disability benefits kick in.

Lost time benefits are 2/3 of your employee’s monthly income and determined by your employee’s earnings the month before the individual is involved in a workplace incident that results in sickness or injury. These benefits are considered temporary and only last while your employee’s doctor is actively treating them. When your employee’s doctor determines that your team member is able to return to work, your employee will receive a letter from the insurance company called a Notice of Claim Status, which clarifies that the doctor said you can officially work again.

If your employee is unable to return to work full-time or can only do modified work, and as a result they are earning less than they usually do, your employee can continue to get benefits, which will be 2/3 of the difference in their earnings.

What are Kentucky’s permanent disability benefits?

Permanent workers’ comp benefits refer to the scenario when your employee’s doctor finds that your employee’s condition is stationary, or not expected to improve any further. 

In this case, the doctor will determine whether your employee has a permanent disability. If your employee does, the doctor will assign your injured worker a percentage of disability, which factors into determining the amount of and duration of benefits.

What are Kentucky’s death benefits under workers’ compensation insurance?

When an employee dies from a workplace injury, Kentucky pays benefits to the surviving spouse and other qualifying dependents. The specific amount and duration of the benefits depends on the employee’s earnings before the injury or accident and the number and type of dependents. If an employee dies within four years of the injury, workers’ comp will pay an additional lump sum to the deceased employee’s estate. 

In Kentucky, when an employee with a valid workers’ comp claim dies of causes not directly related to the workplace injury or illness before maximum workers’ comp disability benefits have been paid out, the surviving spouse and children may still receive some of those unpaid benefits.

What types of injuries are covered with workers’ comp insurance in Kentucky?

Kentucky state law determines what types of injuries are covered by workers’ comp insurance, but there are general guidelines that can help you understand what typically qualifies for a workers’ comp claim.

These include:

  • No intentional self-harm, harm that results from drug or alcohol use, or fighting. 
  • Must fall within the “course and scope” of employment. If you get into a fender bender on your way home from work after you’ve clocked out for the day, that’s unlikely to qualify.  
  • Long-term occupational injuries, including back strain from repetitive motion. When you think of work-related injuries, you probably think of one-time events — but damage can occur over a long period of time. As long as the injury or illness is clearly associated with the employee’s work responsibilities, it may be eligible. 

What are the penalties for not having workers’ comp insurance in Kentucky?

The Kentucky Uninsured Employers’ Fund is not a way out of workers’ compensation insurance for business owners. 

Kentucky’s penalties for failing to provide workers’ comp coverage are especially steep. The most immediate of these consequences will see businesses face fees of $1,000 per employee per day as long as coverage is not provided. 

Additionally, employers may find their business shut down until they obtain a workers’ compensation policy, and sometimes they could even face time in jail. 

There are plenty of ways to cut costs and drive your small business towards profits, but forgoing state mandated insurance coverage is not one of them, especially not in Kentucky. 

How much does workers’ comp insurance coverage cost in Kentucky?

The cost for workers’ comp coverage is based primarily on the types of work your employees do and the total amount of your company’s overall payroll. Coverage class codes are established by the Kentucky Department of Workers’ Claims and aligned with the job’s associated risks. 

With these state requirements in place, your coverage cost overall will be determined by the level of service provided by your company and their ability to offer you competitive rates based on your company’s experience modification  — or claims history  — and other factors, such as steps your company has taken to reduce injuries and accidents.

Several factors that are unique to your business will contribute to your insurance  premiums. 

Some of these factors include: 

  • The type of service your business provides
  • The value of your business property, including any equipment or supplies
  • The annual revenue of your business
  • The location of your business
  • The number of workers your business employs

At Cerity we work with over a hundred different industries. To find your type of business and see more information specific to you, click here

Generally, if you are able to demonstrate to insurance assessors that you provide a safe work environment, thorough precautionary training, and other risk management best practices, you will be able to cut down further on your premiums. 

It’s always a good idea to employ risk management in order to reduce your likelihood of incidents and harm to your employees, but the cost of reduced premiums is a great bonus!

Where can I get workers’ comp for my Kentucky business?

At Cerity, we believe getting workers’ compensation coverage for your Kentucky businesses should be easy. That’s why we’ve created a faster, more affordable approach to workers’ comp insurance coverage. With our proprietary tools and modern technology, we’re able to provide insurance quotes quickly — all without phone calls or paperwork. 

Check out our free business insurance quote tool online to get a free quote and find out how easy protecting your business can be. 

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