Accidents and injuries happen in even the safest work environment. Arizona requires employers to have workers’ compensation insurance to help their employees recover. This insurance provides businesses with essential protection against lawsuits. Here are the ins and outs of securing Arizona workers’ compensation insurance.
Arizona Workers’ Compensation Insurance: An Overview
Why is workers’ comp insurance so important? Let’s take a closer look.
Number of fatal injuries annually: 5,147 nationally in 2017, according to the Bureau of Labor Statistics. Arizona accounted for 90 of these.
Employers cost per $100 of covered payroll: Arizona employers spend $0.95 per $100 of covered payroll.
National ranking (1= largest % increase from 2012-2016): Arizona ranks 11th for the increase in employer costs.
Low rate per $100 in payroll: The lowest rate for Arizona employers is $0.20 for clerical workers.
High rate per $100 in payroll: The highest rate for Arizona employers is $20.61 for laborers.
Filing a Workers’ Comp Claim
Injured employees have 1 year to file a claim. This 1-year window starts from either the date of the injury or the date the employee became aware of the condition. If someone slips, falls and sprains an ankle, the date of the injury is fairly obvious. Some conditions, like carpal tunnel, develop more gradually. The pain might start on March 1, but it may not be painful enough to seek a diagnosis until April 10. In this case, the clock for filing a claim would start on April 10.
To file a claim, employees should use 1 of 2 forms. The first is a pink form called the Worker’s and Physician’s Report of Injury. A medical professional would complete this form. Workers can also submit a Worker’s Report of Injury form, which employees can download from the Industrial Commission of Arizona.
If employees have their claims denied, they do have the right to appeal. They have 90 days from when they are notified about their claim status to request a hearing. They can present their case or work with an attorney if they choose at their expense.
As an employer, you also have the responsibility to file a claim if you are notified about a workplace accident. You would need to complete an Employer Report of Injury form and submit it to the Industrial Commission and your insurance carrier. You can complete the form online. You have 10 days to submit the form.
To complete the form, you will need full details about the accident, including the date and time. You will need to report the employee’s wage, date of hire and other work details.
Choosing a Doctor
As an employer, you can request for an injured employee to see a doctor of your choice once. After that, your employees can see their doctors of choice. They can also opt to continue treatment with the doctor you chose. Once they choose a doctor, they can’t change doctors without approval from their doctor, your insurance company or the Industrial Commission.
How Does Arizona Workers’ Compensation Law Work?
The Industrial Commission of Arizona oversees workers’ compensation insurance. Arizona’s workman’s comp is a “no-fault” system. This means that a covered employee is entitled to receive benefits no matter who caused the accident or illness. The accident, injury or illness just needs to have happened at work or be directly connected to work.
Arizona employers are required to carry workers’ compensation for all employees. It doesn’t matter if they’re part-time or full-time. Employers aren’t required to purchase workers’ comp insurance for independent contractors or for domestic employees in the home, like a nanny.
Your employees can choose to reject workers’ compensation coverage. If they do, it must be before an accident or illness occurs. Employers can’t pressure their employees to reject workers’ compensation insurance, though. Employees can also change their minds and rescind their rejection of workers’ comp, but they must make that decision before filing a claim.
The Consequences of Not Having Workers’ Comp Insurance
Arizona has severe consequences in place for employers that don’t carry workers’ compensation insurance. If an employee is injured or develops a work-related illness and their employer doesn’t carry workers’ compensation, the employee can choose between 2 options. The 1st option is that the employee can file a civil lawsuit. The 2nd option is that the employee can file a claim directly with the Industrial Commission of Arizona (ICA).
If the employee files a qualifying claim with the ICA, the ICA will pay the employee benefits. The ICA will then go to the uninsured employer and request reimbursement plus a penalty of either 10% of the benefits paid or $1,000, whichever is greater.
In most cases, employers can be fined $1,000 for not having workers’ comp insurance. That applies whether or not someone files a claim. The penalty goes up to $5,000 if the employer is uninsured again within 5 years. It goes up to $10,000 if there’s a 3rd instance of being uninsured within 5 years.
Arizona also classifies not having workers’ compensation insurance as a Class 6 felony.
Employer Cost for Workman’s Compensation
The type of work your employees do determines the cost of workers’ compensation insurance. Your business’ claims experience also influences the cost. Here is an estimate of premium costs for several types of employees. This table assumes the employer has 5 employees and estimates a state fee of $250.
Class Code
Class Code Description
Rate
Annual Pay
State Fee
Annual Employer Premium
9083
Fast Food, Concessions and Doughnut Shops
$1.53
$20,862
$250
$2,845.95
0035
Cannabis Growers
$3.20
$51,059
$250
$9,419.45
5183
Plumbing
$5.36
$56,266
$250
$16,329.30
8810
Clerical Office Employee
$0.20
$27,299
$250
$1,523.00
8869
Daycare Providers
$1.51
$21,222
$250
$2,852.25
*This table assumes the employer has 5 employees with an experience modifier of 1 and a state fee of $250*
4 Types of Workman’s Comp Benefits
Workers’ compensation benefits fall into 4 categories:
Wage replacement benefits: Employees who are unable to work receive a portion of their regular wage, up to the state maximum. In Arizona, there is a 7-day waiting period. After that, employees are paid 66 ⅔% of their average monthly wage.
Permanent partial disability benefits: Employees may qualify for this benefit if an injury leaves them disabled but still able to do some work. The level of compensation varies depending on the type of injury.
Vocational rehabilitation benefits: This benefit helps injured workers retrain for a new type of work. This may include job search assistance, vocational counseling and training in specific skills.
Medical benefits: This benefit pays for medical costs from a work-related illness or injury. This may include doctors’ fees, emergency room charges, prescription medications and medical equipment like crutches and braces.
Best Arizona Workers’ Compensation
Workers’ compensation insurance protects your workers and your business. Here are the 5 best workers’ compensation insurance companies in Arizona, based on our research.
securely through The Hartford Workers Comp's website
For insurance to be useful, the claims process needs to be transparent and easy to use. The Hartford boasts impressive reviews from employers, averaging 4.8 out of 5 stars with over 5,400 reviews. Employers speak highly of The Hartford’s representatives, who explained the claims process clearly.
The Hartford offers an extensive provider network and contracts with more than 65,000 pharmacies nationwide. It also has experienced nurse care managers to help employees navigate the recovery process.
2. Simply Business: Best for Tailored Coverage
Best For:
Tailored coverage
VIEW PROS & CONS:
securely through Simply Business Insurance's website
Simply Business offers a comprehensive suite of business insurance that specializes in making it easy to insure your business.
Whether you’re looking for construction workers' insurance or insurance for your startup, Simply Business helps you find the right coverage at the right price.
Tell Simply Business a little bit about your business and you'll get almost-instantaneous affordable quotes from top insurance providers. You can look into workers’ comp insurance that will cover everyone on your team, and you can get covered in accordance with Arizona law without overspending.
Building your business is hard enough. Let Simply Business make it easier. Get a quote from Simply Business today.
securely through Tivly, a Liberty Mutual Partner's website
Liberty Mutual closes claims faster and at a lower cost than the industry average. This means that your employees get back to work faster, without compromising on the quality of care. It has experts on staff to help walk you and your employees through the claims process.
Liberty also offers risk control specialists who can help you evaluate your workplace for potential safety issues and resolve those. This helps you minimize workplace injuries and liability.
4. Progressive: Best for Small Business
Best For:
Contractors
VIEW PROS & CONS:
Small businesses have unique needs. Small business owners are often operating with little time and a tight budget. Progressive helps to take care of both. You can easily get a quote online, and it offers affordable workers’ comp coverage.
If you’d like more in-depth information, you can also call to speak with its staff experts. Progressive includes liability insurance in your policy to provide your business with further protection.
5. AIG: Best for Risk Reduction
AIG emphasizes risk reduction for businesses. AIG workers’ compensation insurance provides you with access to industry specialists who can help you lower workplace risk.
It works with clients of all sizes and across industries. It uses data analytics to inform the claims process and get your employees back to work sooner rather than later. You need to contact them directly for a quote.
Choosing Workers’ Compensation Insurance
Choosing the best Arizona workers’ comp insurance for your business is a big decision. Even though it’s time-consuming, it’s worthwhile to research and get multiple quotes. You may want to talk to other employers in your industry. Ask who they’ve worked with and whether they’re happy with the claims process.
After you receive your quotes, choose a balance between affordability and service. Workers’ comp insurance is an investment in your business and in your employees.
Frequently Asked Questions
Q
1) Q: How long can an employee stay on workers’ compensation?
A
The length of time that an employee can remain on workers’ compensation is set by the state. Usually, the range is from 3 to 7 years. In addition to that, there is generally not a limit for permanent disability benefits unless you live in a state that terminates the benefits at age 65. For employers seeking the cheapest workers’ compensation insurance, check out these top providers.
Q
2) Q: Who pays for workers’ compensation benefits?
A
The employer is responsible for purchasing workers’ compensation insurance to cover the benefits of employees. The must pay a monthly premium based on class code and payroll. To get a custom workers’ compensation quote, click here.
Q
3) Q: Do I have to get workers’ compensation insurance?
A
This depends on which state you have employees. The following states require workers; compensation under specific requirements: AK, CA, CO, CT, DE, HI, IL, IA, KS, KY, MD, MA, MI, MN, MS, NH, NJ, NY, NC, OH, OK, SC, SD, UT, WA. To get the best workers’ compensation premium, enter your zip code here.
Methodology
Benzinga crafted a specific methodology to rank workers comp insurance. We prioritized carriers based on coverage options, specialized industries, customer service experience and how quickly and easily you're able to get insured including online tool usage. We also included workers comp insurance quote aggregators in lists to make it easy and efficient to compare policy quotes and options. To see a comprehensive breakdown of our methodology, please visit see our Workers' Compensation Insurance Methodology page.
Most Dangerous Industries Per State
The construction industry reports the most injuries and workers' compensation claims in 38 out of 50 states.
Second place goes to the forestry industry, followed by the transportation industry. By law, businesses with more than 1 employee must carry workers' compensation insurance. Workers' compensation insurance protects both your business and employees and creates a safety net for wage replacements and medical benefits.
Use our calculator to determine how much workers' compensation will cost you and your business.
