Buying workers’ compensation for:


State Fund: Yes, Competitive. SCF was founded in 1925 and was originally part of the Industrial Commission of Arizona. In 1969, the Arizona Legislature separated SCF from the Industrial Commission, allowing SCF to begin operating as a private business. SCF Arizona is funded entirely by policyholders’ premiums and by investments. SCF receives no state funds and is not tax supported. SCF is fully competitive and operates under the same rules, rate structure and regulations as all private insurance companies providing workers' compensation insurance in Arizona.

Insurance Coverage Requirements: Workers’ Compensation is compulsory in Arizona, some waivers are permitted.

Who is Required to Purchase Workers’ Compensation Coverage?

Arizona law requires that all Arizona employers with one or more employees maintain workers’ compensation insurance.

Factors that Impact Coverage

  • You are a sole proprietor or partner: You are excluded from coverage but have the option to purchase Elective Coverage.
  • You are a corporate officer: You are excluded from coverage but have the option to purchase Elective Coverage.
  • You are a member of an LLC: Whether you are required to be covered by the LLC’s workers compensation policy depends on how the business has elected to files its taxes.

Failure to Secure Compensation

If an employer fails to obtain workers’ compensation insurance, the ICA (Industrial Commission of Arizona) is authorized to assess civil penalties against the employer.

If an employer continues to disregard the legal requirement to obtain workers’ compensation insurance, the ICA may assess additional civil penalties against the employer, up to $10,000 and may obtain an injunction to close the employer’s business until the employer complies with the law to obtain workers’ compensation insurance.

The ICA may also refer the matter to the Office of the Attorney General or to another law enforcement authority for prosecution of an uninsured employer with a Class 6 Felony for failing to comply with the law requiring workers’ compensation insurance.

Proof of Coverage is Required

Each employer providing insurance or electing to pay compensation directly must post in one or more conspicuous places about his place of business typewritten or printed notices, in English and Spanish, stating that he has complied with the provisions of the workers’ compensation laws.

Employers must post the following two forms immediately next to the Notice to Employees shown immediately above.
Work Exposure to bodily Fluids English
Work Exposure to bodily Fluids English Spanish
Work Exposure to MRSA, Spinal Meningitis, or Tuberculosis TB

The "Employee Safety and Health Protection" poster must be printed on 8 1/2 x 14 inch paper. You may have to adjust your computer or printer to print this poster properly.

Failure to Comply: If an employer fails to post and keep posted the notice as required by this section, or fails to keep available at the place where the employees are hired the blank forms of notice to be signed by the employee, no employee who thereafter engages in employment for such employer, during the time that the notices are not posted or during the time that the blanks are not available, shall be deemed to have accepted the provisions of this chapter, and it shall be optional for such employee, if injured during the period when blanks were not available or the notice was not posted, to accept compensation under the provisions of this chapter or maintain other action against the employer.

Independent Contractors

Mistakenly classifying an employee as an independent contractor can result in significant fines and penalties.

View 20 factors used by the IRS and our independent contractor questionnaire to determine whether you have enough control over a worker to be an employer.

Key Resources

Other Tips

If your insured employs workers in multiple states or your insured’s employees are temporarily working out-of-state, they need to purchase insurance for all the states where their workers are located, according to each state’s laws. Call 1-800-476-2948 and let us walk you through it.

The nature of your insured’s business, number of employees being covered and past coverage and claims are all factors in how much their premium will cost.