If you have a family business in Valencia, CA, you may wonder if you need to purchase workers’ compensation insurance. The answer to this question depends on a few factors. You can learn more about workers’ compensation from QuoteBroker Insurance Services and whether or not your family business needs it.
What Is Workers’ Compensation?
Workers’ compensation is a system in the United States and many other countries that provide benefits to injured workers or who contract an illness at work. State governments usually administer the program as part of social welfare programs.
Are Family Members Exempt from Workers’ Comp in California?
No. California Labor Code Section 3351 defines an employee as any person employed by an employer, regardless of their legal status. This includes employees who are related to the employer.
Who Can Be Excluded from Workers’ Compensation in California?
The Labor Code specifies that every employer must secure workers’ compensation insurance or self-insurance that provides their employees medical benefits and partial lost wages. To elect for self-insurance, the employer must meet a set of criteria defined by the Department of Industrial Relations. Some of these criteria include the following:
For Three Full Years, The Company Must:
- Be a legally-recognized business
- Have independently audited and certified financial statements
- Have an acceptable credit rating
A Note On Sole Proprietors:
Business owners who do not have any employees do not need to purchase workers’ compensation insurance. However, they may elect to buy it to cover themselves.
Give Us A Call
QuoteBroker Insurance Services, located in Valencia, CA, offers workers’ compensation insurance to businesses and individuals in the area. We are dedicated to providing our clients with great coverage at competitive rates.
Contact us right away to get started!