Texas Workers’ Compensation Insurance

As the second largest state in the country, Texas has so much to offer. With many booming businesses and start-up companies, you may be wondering what you need when it comes to workers’ compensation insurance. Also known as workers’ comp or workman’s comp, most states require employers to carry this coverage. In the Lone Star State, however, you’re not required to have it.¹

Even though it’s not required by law, it’s still a good idea to have workman’s comp insurance in Texas. In addition to helping employees return to work, it can also help employers pay for legal costs if they get sued because of an injury or illness. Without coverage, you’d have to pay for these costs out of pocket, which puts your business at financial risk.

What Is Workers’ Compensation in Texas?

Texas workers’ compensation insurance gives your employees benefits to help them recover from a work-related injury or illness. This coverage can also help employers because it provides a defense against claims of:

Assumption of risk
Contributory negligence
“Last clear chance”
Co-worker negligence

Without workers’ compensation insurance in Texas, the business owner is responsible for all costs related to a personal injury lawsuit. Even if it’s your employee’s fault that they got hurt or sick, you’d still have to pay for costs related to the lawsuit.

Coverages for Workers’ Comp Insurance in Texas

With coverage, business owners and employees can experience many types of workers’ compensation benefits, such as:

Income benefits, such as lost wages from missing work
Medical benefits to help treat a work-related injury or illness
Legal benefits if a worker’s family sues your business
Death benefits to an employee’s family if they lose their life in a work-related accident

According to Texas’ workers’ comp laws, employees have 30 days to give notice of a work-related injury or illness to their employers.³ They also have a year to file formal paperwork for the workers’ comp claim. After getting a report of injury, employers have eight days to notify their insurer.

Is Workers’ Comp Required in Texas?

Texas doesn’t have a workers’ comp requirement. But being a “non-subscriber” or operating a business without it can put your company at serious risk.² That’s because without coverage, your business faces personal injury lawsuits.

You can get coverage from any insurance carrier licensed to write workers’ compensation insurance in Texas. As a small business owner, you should be sure your employees are safe and that you’re minimizing on-the-job injuries.

Texas Workers’ Compensation Laws

In all states, workers’ compensation insurance laws vary. No two states have exactly the same laws and regulations. Although Texas doesn’t require employers to have coverage, there are rules on how the insurance works. Texas’ workers’ compensation laws set the limits on how many benefits employees will get if they’re hurt or sick on the job.

Some requirements you should be aware of include:⁴

Disclosing to employees whether a business has workers’ compensation insurance.

Notifying the Workers’ Compensation Division of the Texas Department of Insurance if they no longer have coverage. You can do this with Form DWC005.

No coverage for injuries as a result of:

Employee horseplay
Willful criminal acts or self-injury
Intoxication from drugs or alcohol
Voluntary participation in off-duty recreational activity
Acts of God

Learning and understanding Texas workers’ compensation law is extremely important when it comes to the safety of your business and employees.

The Division of Workers’ Compensation Texas

The Texas Department of Insurance (TDI) regulates the workers’ compensation system in the state, ensuring that all workers’ compensation costs are kept at a reasonable rate.

The Division of Workers’ Compensation (DWC) monitors both employees and employers. It will take action to make sure businesses and workers are following state laws, such as the:

Texas Workers’ Compensation Act
Texas labor code
Other workers’ comp insurance regulations

Texas Workers’ Compensation Rates

In Texas, workers’ compensation insurance costs include:

Insurance premiums
Payments made under deductibles
The administrative costs of handling claims and making reports to the state of Texas and your insurer

Texas workers’ compensation rates vary and insurance carriers can use different factors to determine costs, including:

The type of work your employees do, because the higher the risk, the more it can impact your insurance price.
Your claims history, since a safer work environment means you won’t have to file workers’ compensation claims and can result in a lower insurance cost.
Payroll size, because your insurance rate will be higher the more employees you have.

The best way to find out how much you’ll have to pay for workers’ compensation insurance is to get a quote. We’re an experienced insurance company that can help you get the coverage you need. Whether it’s coverage questions or filing a claim, our specialists are here for you at every step.

Workers’ Compensation Claims

To file a claim for workers’ compensation in Texas, visit our workers’ comp claims page today.

This article provides general information, and should not be construed as specific legal, HR, financial, insurance, tax or accounting advice. As with all matters of a legal or human resources nature, you should consult with your own legal counsel and human resources professionals. The Hartford shall not be liable for any direct, indirect, special, consequential, incidental, punitive or exemplary damages in connection with the use by you or anyone of the information provided herein.

^{1,2 3,4} Texas Workforce Commission, “Workers’ Compensation”

Texas Workers’ Compensation