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Is Workers' Comp Required in New Jersey

New Jersey Workers Compensation Requirements

    All employers in New Jersey are required to provide workers comp coverage for employees. Out of state employers who hire employees in NJ and perform any work there are also required to have a policy.

    Sole-Proprietors, Partners and LLC Members are automatically excluded on a policy, but they can elect to be covered. A Notice of Election (Form 134 NJ) must be filed with the state and insurance company.

    All Corporate Officers are automatically included in coverage and are not permitted to exclude themselves from a policy.

    New Jersey law is broader than the IRS with regard to the definition of an employer-employee relationship. Employers can be held liable for coverage for non-typical employment situations.

Workers' Comp Exemptions in New Jersey

    Sole-Proprietors, Partners and LLC Members included on a workers compensation policy must use a minimum payroll amount of $33,800 for work comp rating purposes.

    Corporate Officers must utilize a minimum payroll of $33,800 and a maximum of $134,680 in order to calculate the cost of workers comp insurance.


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How is Workers Comp Calculated?

Workers' compensation is a commercial insurance product categorized as Property & Casualty insurance (P&C Insurance). Even though workers comp is calculated using estimated payroll wages and class codes, premium is still a separate business expense from the cost of payroll. Business owners may treat the cost of coverage as an expense on their taxes.

Work comp rates for all job classification codes are always expressed as a percentage of $100 in wages. An annual policy is always subject to an audit because it was based on estimated wages and not actual wages.

Here is an example using two class codes with different estimated payroll for each class code:

Class Code Insurance Companies Rate Per $100 Estimated Annual Payroll Divide Payroll by 100
8810 Clerical $0.28 base manual rate $25,000  (25000 divided by 100) 250
8835 Home Health Care $1.75 base manual rate $100,000  (100000 divided by 100) 1000

In order to calculate the cost of the policy you only need to multiply each rate with its divided payroll. It benefits employers to re-calculate their premium as their payroll becomes larger than originally anticipated.

Class Code Workers Comp Calculator Estimated Premium
8810 Clerical $0.28 X 250 $70.00
8835 Home Health Care $1.75 X 1000 $1,750.00
Workers' Compensation Laws Vary by State

Every state has their own rules for how employees must be covered and how they must be classified for rating premium. A lot of states use state specific class codes and have different requirements for who is obligated to carry workers' compensation insurance coverage.

If you have employees that travel out of state for work, or they work in multiple states throughout the year, you may need to purchase insurance for all the states where your workers are located and working. In most cases, you can add multiple states to one policy.

Workers' Compensation Insurance in New Jersey can be purchased from private insurance companies authorized by the state to provide coverage. The Assigned Risk Pool, or State Insurance Fund, is available for employers who are unable to find coverage from a private company. WorkersCompensationShop.com can help you navigate your best options.

Policy premium is based on numerous factors including: class codes assigned to your business and employees, estimated payroll, covered states, prior policies, owner experience and previous insurance claims.

Enjoy the benefits of our Pay As You Go Workers' Comp Options in New Jersey.

$O Deposit or Minimum Down

We've developed Pay As You Go workers compensation programs that reduce or eliminate premium deposits and allow New Jersey employers to report and pay premium based on actual payroll wages. Protect your business from audits.

Lower Monthly Payments

We've negotiated special deals with many of our insurance partners. We offer more flexible payment options, like 12 equal installments plans and monthly reporting programs, to help improve cash flow for our business owners.

Fast and Accurate Quotes

At Workers Compensation Shop.com, we know exactly which insurance companies have the lowest cost for every class code available. Our rate tracking system helps us quote your business with the right carriers every time.

New Jersey Workers Compensation Insurance Quotes

NJ Workers' Comp Specialists

We're a national agency that specializes in workers comp insurance. We work with our insurance carriers to develop and administer target programs with easier underwriting and better rates. When you quote with us, you get our best prices on workers comp every time.

Help with NJ Class Codes

Insurance rates vary significantly between workers comp classification codes. Let our NJ Workers Compensation Specialists help you determine your best workers compensation class codes before your buy a policy. We'll help make sure your business is properly covered.

Fast Workers' Comp Quotes

We make the process of getting workers compensation quotes fast and easy. We know your time is valuable. That's why we work harder to streamline the quote process, compare your rates and coverages, and present your best options as quickly as possible. We often have your insurance quotes ready in less than 24 hours.

Compare Rates With More Carriers

We're a National Agency, and we have tons of carriers offering work comp in New Jersey. We have access to over 35 insurance companies with a broad appetite and competitive rates. Our markets know we expect the lowest rates, bigger discounts, and more policy credits when we request a quote.

THE RIGHT QUOTE MAKES A DIFFERENCE.

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WORKERS' COMPENSATION INSURANCE
Did you know that the cost of a workers comp policy in New Jersey can vary significantly between insurance company, underwriter, and insurance agency?
Find the best deal on workers compensation insurance.
Visit NCCI for more resources and information about workers' compensation class codes. Visit United States Department of Labor for more information about government agencies managing workers compensation insurance rates.

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