Clarification of Answer by
01 Mar 2005 11:47 PST
Will the non-shareholding officer need to be covered?
Your answer indicates that this person will not need to be covered,
but I want specific clarification of this case, which is really
the only one I am concerned with.
Sorry, I misunderstood your question.
I thought you meant that all officers were also owners.
No, the officer who is not a shareholder does have to be covered.
He is simply an employee of the company.
All employees must be covered except the owners.
This isn't a gray area.
Go back to that same FAQs page and that's what the second answer says:
"Generally, all employees of the company, as legally defined,
including corporate officers and directors, must be included in the
policy unless they are the sole owners of the firm, in which case they
may elect not to be covered."
Frankly, these days, worker's compensation insurance isn't that costly.
They have waived the $600 minimum payment/deposit everyone used to require
to open the account. Now, it costs more like $200 per year, depending on
And let's face it, if you have someone working for you...you don't want
them suing you personally if anything happens.
Best place to get coverage for just one person is the State Compensation
Insurance Fund. They are a quasi government agency. And when they are
profitable, they give their policyholders dividends that reduce annual
Also, check your business liability policy to see if they include workers
compensation coverage as part of your policy. They might.
Let me know if you have any other questions.