Employers in Illinois are required to carry workers’ compensation insurance if they have one or more employees. It’s a felony not to do so. The only exception to this is if you work for yourself or are the owner of a company. In those cases you can opt out and don’t have to cover yourself.
Of course if you are working, even if you are the owner, and get injured, not having insurance could really ruin your life. A recent caller to my office had this happen to him as he tore his ACL and can’t work for about six months. He used to be covered under his own policy, but no longer is. There is unfortunately nothing we can do for him now.
If you do elect to have yourself covered under the policy and get injured, it’s often a unique type of case. First, your average weekly wage is based off your salary, but some owners choose to only take profit distributions. This can make proving what you really earn a mess. Second, the case is essentially you versus you although it’s really you versus your insurance company. That of course makes the case harder for them to defend and fight and if they want to keep your business, they might not fight as hard. On the flip side though, if they think they are losing money by insuring you they might actually fight it harder and/or drop you as a client.
Whether or not to cover yourself is usually a bottom line or risk/reward decision. That said, if you are in a heavy duty job or one that has a risk of injuries, it’s really a bad idea not to carry work comp insurance on yourself, especially if your family can’t afford to be without your income for some time. The other issue is that if it is a work related accident, your personal insurance might choose to not cover the bills and they will care less if you are covered by your own insurance or not.
There are some other quirks when you work for yourself. Illinois workers are supposed to report their accident to the company within 45 days of it happening. You are reporting to yourself, but if you have a HR department, GM or someone else that has authority, it would be safe to report it to them ASAP. If you have restrictions that prevent you returning to a full duty job, an argument could be made that you should be able to create work for yourself that falls within those restrictions. Bottom line is that you can expect a fight over TTD if you are off work.
These are unique cases, but we’ve been involved in them before with success. If you have any questions or want to talk to a lawyer, contact us for free any time.