Workers Compensation

excepts from the Workers' Compensation Rating and Inspection Bureau website www.wcribma.org

 Who has to provide workers' compensation insurance?

Every Massachusetts employer  is required to provide workers' compensation insurance coverage for their employees.  Refer to M.G.L. Chapter 152, Section 25A.  

An employer may be an individual, partnership, joint venture, corporation, limited liability company, association, or a fiduciary such as a trustee, receiver or executor, or other legal entity.  Refer to M.G.L. Chapter 152, Section 1 [5] for a definition of employer.

 Can an executive officer be excluded from workers' compensation insurance coverage?

According to M.G.L. c. 152, Section 1(4) as amended by Chapter 169 of the Acts of 2002, workers' compensation coverage is elective for an officer or director of a corporation who owns at least 25% of the issued and outstanding stock of the corporation.  For corporate officers to become exempt from coverage, a Form 153 must be filed with and approved by the Department of Industrial Accidents in accordance with Regulation 452 CMR 8.00.  A copy of the filed and approved Form 153 must be mailed by the employer to their insurance carrier. Insurance carriers who receive an approved Form 153 should endorse the policy with NCCI endorsement WC000308 - Partners, Officers and Others Exclusion Endorsement. Refer to Circular Letter No. 1902.

 Can a sole proprietor, partner, or member of an LLC be covered by their workers' compensation insurance policy?

According to M.G.L. c. 152, Section 1(4) as amended by Chapter 169 of the Acts of 2002, sole proprietors, partners of a legal partnership, and members of an LLC may elect to be treated as employees and obtain coverage for themselves under a workers' compensation insurance policy.  If a sole proprietor, partner, or member elects to be covered as an employee under a workers' compensation policy, the sole proprietor, partner, or member must submit a written request on the employer's company letterhead signed by the sole proprietor, partner, or member to the insurance carrier.  The letter must specify the name and duties of each sole proprietor, partner, or member who is electing to be covered under this policy. The premium for sole proprietors, partners and members of an LLC who elect to become employees and obtain workers compensation shall be based on a fixed amount (see table below) that will change on October 1 each year. Insurance carriers who receive these written requests for coverage should endorse the policy with NCCI endorsement WC000310 - Sole Proprietors, Partners, Officers and Others Coverage Endorsement. Refer to Circular Letter No. 1901, Circular Letter No. 1902, and Circular Letter 1942. Additional references: Department of Industrial Accidents Regulation 452 CMR 8.00, Rule IX in the MA Manual for payroll determination information, and the Miscellaneous Values page in the MA Manual for the fixed amount.

 What is the current payroll limitation applicable to executive officers?

Premium for executive officers is based on their total payroll, subject to the following limitations:

• The minimum individual payroll for an executive officer is $200 per week, or $10,400 per year.

• The maximum individual payroll for an executive officer is $1,000 per week, or $52,000 per year.

Refer to Rule IX A. 3. in the MA Manual.

MA Division of Insurance - Workers' Compensation Insurance Frequently Asked Questions