Buying workers’ compensation for:


State Fund: No

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

Who is Required to Purchase Workers’ Compensation Coverage?

Virginia law requires every employer who regularly employs three or more full-time or part-time employees to purchase and maintain workers’ compensation insurance. Employers with fewer than three employees may voluntarily come under the Act.

Sole proprietors and partners are considered owners of businesses and are not covered by workers’ compensation. However, sole proprietors and partners may elect to obtain coverage for workers’ compensation liability by purchasing insurance.

Members of a limited liability company(LLC) are considered to be owners of a company and are not covered by workers’ compensation unless specifically covered by an insurance policy or either elected or appointed as a manager. The manager of an LLC is treated as a corporate officer under the Act.

A corporation’s officersmay choose to reject workers’ compensation coverage for accidents, but not for occupational diseases. To do so, officers must file a "Notice of Rejection" with the insurer and with the Commission. If the officers are paid regularly, they are nevertheless counted as employees to determine jurisdiction under the Act.

Note: For non-profit corporations under §501(c)(3) of Title 26 of the U.S. Code, unpaid officers are not considered employees. Unpaid officers need not formally reject coverage and are not counted as employees in determining jurisdiction under the Act.

Factors that Impact Coverage

  • You are a sole proprietor or partner: In Virginia, you are excluded from coverage but have the option to include yourself.
  • You are a corporate officer: Virginia includes you in coverage, but you have the option to partially exclude yourself; that is, you may reject workers’ compensation coverage for accidents, but not for occupational diseases. To reject accident coverage, please file a "Notice of Rejection" with the insurer and with the Virginia Workers’ Compensation Commission.
  • You are a member of an LLC: You are excluded from coverage but may include yourself.

Failure to Secure Compensation

Employers who refuse or neglect to obtain workers’ compensation insurance can be fined up to $5,000.00. Continuing failure to obtain this insurance can result in an order prohibiting an employer from conducting business. Employees of uninsured employers may bring suit against the employers for damages resulting from their injuries.

Proof of Coverage is Required

Employers must post in a prominent place, a notice of workers’ compensation benefits that substantially resembles the notice produced by the Virginia Workers’ Compensation Commission.

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.

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.