Workers’ Compensation Insurance in North Carolina

How Is Workers’ Compensation Insurance Defined in North Carolina?

In North Carolina, workers’ compensation is a form of “no-fault” insurance that is provided by the employer for the employee. This coverage offers benefits for medical bills, lost wages, and death benefits due to on-the-job injuries or illnesses. In exchange for these benefits, the employee gives up certain rights to sue in relation to the incident. 

What Are the Laws That Govern Workers’ Compensation Insurance in North Carolina?

The North Carolina Workers’ Compensation Act requires that all businesses that employ three or more employees, including those operating as corporations, sole proprietorships, limited liability companies, and partnerships, obtain workers’ compensation insurance or qualify as self-insured employers for purposes of paying workers’ compensation insurance benefits to their employees. Self-insurance means that businesses are committed to handling all costs associated with workplace injuries or illnesses out of pocket, without any assistance from an insurance policy. This is not the ideal option for most businesses. 

Exceptions to the requirements as outlined above include:

  • Employees of certain railroads
  • Casual employees, i.e., persons whose employment is both casual and not in the course of the trade, business, profession, or occupation of the employer
  • Domestic servants directly employed by the household
  • Farm laborers, when fewer than 10 full-time, non-seasonal farm laborers are regularly employed by the same employer
  • Federal government employees in North Carolina
  • Sellers of agricultural products for the producers thereof on commission or for other compensation, paid by the producers, provided the product is prepared for sale by the producer

What Does Workers’ Compensation Insurance Cover in North Carolina?

Workers’ compensation insurance in North Carolina covers the cost of medical treatment, including emergency and ongoing care, when an employee experiences a workplace injury or develops a work-related illness. In addition, workers’ compensation provides benefits for lost wages, which typically amount to two-thirds of the employee’s average weekly wage. Temporary total disability, permanent partial disability, permanent total disability, and death benefits are also offered.

What Are the Penalties in North Carolina for Not Having Workers’ Comp Insurance Coverage?

North Carolina takes workers’ compensation violations very seriously. The NC Industrial Commission states that businesses found to be noncompliant can face stiff financial penalties. For businesses, fines can include a minimum of $50.00 per day up to $100 per day depending upon number of employees, and for individuals, fines usually amount to an assessed cost of claim as penalty. In addition, those found noncompliant can be charged with a misdemeanor, be charged with a felony, or even be imprisoned.

Learn more about workers’ comp coverage requirements in other states here

What Types of Injuries Are Covered by North Carolina Workers’ Comp?

Although North Carolina state law determines exactly what types of injuries are covered by workers’ comp insurance, there are general guidelines that can help employers understand what typically qualifies for a workers’ comp claim.

The types of injuries typically covered by workers’ comp are:

  • Injuries that are not the result of intentional self-harm or harm from drug use, alcohol use, or fighting
  • Injuries that fall within the general “course and scope” of the worker’s employment, such as long-term occupational injuries, including back strain from repetitive motion

For more information about the workers’ comp claim process, visit our learning center

What Are Workers’ Comp Death Benefits in North Carolina?

In the event that an injured or ill worker dies due to a work-related condition, that worker’s dependents (as defined by law) may file a death benefits claim. Death benefits in North Carolina include weekly compensation that is equal to 66 and 2/3 percent of the average weekly wages of the deceased employee at the time of their accident. The compensation cannot exceed the maximum amount established annually by the state and cannot amount to less than 30 dollars per week. Dependents can also be reimbursed for funeral expenses not exceeding $10,000.

The state defines dependents as: 

  • A surviving spouse presumed to be wholly dependent and living with the deceased worker or living apart for justifiable cause
  • Minor children (under 18) presumed to be wholly dependent, including adopted children, stepchildren, acknowledged illegitimate children, and children born after the worker’s death
  • Partially dependent individuals or next of kin if there are no immediate dependents

How Do Workers’ Comp Settlements Work in North Carolina? 

As is the case with other states, workers’ comp settlements in North Carolina are mutually beneficial agreements between the injured or ill employee, the employer, and their insurer that close workers’ comp claims completely. Settlements usually result in an agreed-upon amount being paid to the employee via either structured installments or a lump sum. In exchange for this settlement payout, the employee agrees to seek no additional benefits, claims, or lawsuits in relation to the closed claim in the future.

What Are the Statutes of Limitations Regarding Workers’ Comp in North Carolina? 

In North Carolina, injured or ill workers have two years from the date of their injury or diagnosis of their illness to file a workers’ comp claim. To receive death benefits, dependents must file their claim within six years after the worker’s death or within two years of the final determination of disability, whichever is later.

How Much Does Workers’ Compensation Insurance Cost in North Carolina?

As is the case with other states, the cost of workers’ comp premiums in North Carolina will vary based on a variety of circumstances. Private insurers are allowed to set their own rates, and typically premiums are determined using several factors that are unique to each business. Business owners in the market for an insurer should consider comparing quotes from multiple companies before making their choice. 

It helps to remember that every business’s premiums will be different. For example, if your business is considered low-risk, like an office, your rates might be lower than businesses that are considered high-risk, like transportation. 

Many factors unique to your business will be utilized to determine your exact insurance premiums. 

Some of these factors include: 

  • The location of your business
  • The size of your business and the number of employees 
  • The industry in which your business operates

Business owners can try to lower their insurance premium costs in North Carolina by prioritizing risk mitigation techniques. Insurance providers take into account how seriously businesses take workplace safety when calculating workers’ comp premium rates. Simple steps such as enacting employee training sessions, following industry best practices, and creating safety protocols could possibly help lower your insurance premiums. 

How Do I Get Workers’ Comp for My North Carolina Business?

If your business is located in North Carolina and you’re seeking workers’ comp coverage, you can purchase a policy through any private insurance company, agent, or broker that is licensed to operate in the state. If you are unable to be approved for coverage from private insurers due to high risk, you can get coverage from the state’s assigned risk pool. Luckily, getting workers’ comp coverage in North Carolina can be hassle free with the right private insurance provider.

Cerity offers a faster, more affordable approach to workers’ comp. Our goal is to help North Carolina businesses like yours get insurance premium quotes easily — without annoying phone calls or paperwork. Using proprietary tools and modern technology, we provide business owners with quick quotes and instant policies. 

To get workers’ compensation insurance, check out our free online quote tool and see how easy it is to protect your North Carolina business.

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