Buying workers’ compensation for:


State Fund: Yes, Competitive

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

Who is Required to Purchase Workers’ Compensation Coverage?

Every employer with one or more employees is required to maintain coverage. There are no special exceptions for family member employees or part-time employees. Out-of-state employers doing any work in this state are required to have Kentucky workers’ compensation insurance.


1) Domestic servants working in a private home of an employer who has less than two employees each regularly employed 40 or more hours a week in domestic servant employment.
(2) Any person employed by a homeowner to do residential maintenance, remodeling or repair lasting no more than 20 consecutive workdays.
(3) Individuals performing services for aid or nourishment only from religious or charitable organizations.
(4) Employees protected by federal law including railroad and maritime workers.
(5) Persons engaged solely in agriculture (farm laborers).
(6) Any person covered under workers’ compensation, but rejects the coverage.
(7) Any person participating as a driver or passenger in a voluntary vanpool or carpool program while that person is on the way to or from his place of employment.
(8) Members of an established religious sect with a conscientious objection to receiving benefits of any public or private insurance.

Factors that Impact Coverage

  • You are a sole proprietor or partner: In Kentucky, you are excluded from coverage but have the option to include yourself.
  • You are a corporate officer: You are included in coverage but may be excluded.
  • You are a member of an LLC: Kentucky excludes you from coverage; however, qualified members who participate in business decision making and profits and losses may be included. If included you are treated like a partner.

Failure to Secure Compensation

The Office of Workers’ Claims can issue a citation resulting in a fine of $100 to $1,000 for each offense. The penalty can be substantial since each employee and each day of violation shall constitute a separate offense. A court injunction prohibiting the employer from doing business until it comes in compliance can also be obtained. Additionally an employer may be held liable to an injured employee (or employee of an uninsured contractor or subcontractor) for income benefits including lost wages and medical expenses.

Proof of Coverage is Required

Kentucky statute requires every employer to display a Workers’ Compensation Posting Notice conspicuously at its principal office and other locations, where employees report for payroll and personnel matters. [The workers’ compensation insurance carrier should provide this notice at each policy renewal. This posting must provide current policy information and instructions to employees for reporting workplace injuries. Contact your insurance agent or workers’ compensation carrier for a current notice if you did not receive one with your latest policy.

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.