Monopolistic states such as Wyoming, Washington, North Dakota and Ohio do not include liability insurance for employers in their workers compensation policies. For this reason, it is important to consider stop gap insurance to cover the exposures left in your staffing firm’s insurance policies.
The monopolistic states require employers to purchase workers compensation directly from the state versus through insurance companies. As such, only workers compensation is covered and nothing else. No riders can be added to include additional policies or circumstances.
Employer Liability Coverage
In non-monopolistic states, coverage for workers compensation purchased through an insurance company often includes an employer liability coverage. This added coverage protects the employer when the injured or ill worker files a lawsuit against them. The legal fees associated with a suit are often covered.
Gaps in Coverage
Stop gap insurance works to fill the gaps in coverage filled in non-monopolistic states with employer liability insurance. If an employee is injured or becomes ill on the job, your workers compensation policy may not provide the necessary coverage leaving you hanging out to dry.
If you operate in a monopolistic state, speak to your insurance agent or broker about stop gap insurance. Covering the gaps left behind by the workers compensation policy can save the company from a potential financial loss associated with a lawsuit.