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What is a Workers’ Compensation policy?

For a better understanding of what a ghost policy is, let us first understand what a workers’ compensation insurance policy is. Workers’ compensation is a type of insurance policy that provides wage replacement and medical benefits to employees injured while doing their job. The employees in return will waive his rights to sue his or her employer for any form of negligence on their part. Workers compensation policy is primarily based on payroll and the type of risk of the contractor/company is exposed to.

What is a Ghost Policy?

A worker’s compensation ghost policy is a type of insurance policy where the owner is excluded and there is no other employee under the company’s payroll. It is referred to as a ghost policy because it technically does not provide any real coverage.

You may ask, so if there is no employee on payroll, why do I need to have a ghost policy?

Contractors or individuals normally purchase this ghost worker’s compensation policy because some general contractors and companies will not let a contractor on a jobsite without a certificate of insurance that shows Workers Compensation Insurance. For example, a subcontractor bids for a certain project and gets the job, the general contractor will require him to have this own worker ‘compensation policy. Unless you present them a certificate of insurance proving that you indeed carry such policy, you will not be allowed to start the job and may lose the project. This is to ensure that in the event where the subcontractor hires an employee, he will have some sort of coverage in place for the said employee.

Since workers’ compensation policy is based on payroll, it is a no brainer that the ghost policy is the most affordable type of workers’ compensation policy you can get in the market. You however need to make sure that every subcontractor you hire provides you a certificate of insurance that shows that they have Workers Compensation Insurance. If you fail to do this you will be charged for the amount you paid to that subcontractor under your workers compensation policy. This could be quite expensive.

List of states and Ghost Policy avaliability

For the list of states and ghost policy availability, please refer to the table below. For states where ghost policy is not available, we always have the option for you. Workers compensation ghost policy may not be an easy type of policy to find and not every insurance agent is willing to do the work for you. So, take advantage of our service and contact us for your insurance needs.

State Availability
Alabama (AL) Available
Alaska (AK) Available
Arizona (AZ) Available
Arkansas (AR) Available
California (CA) Not Available
Colorado (CO) Not Available
Connecticut (CT) Available
Delaware (DE) Not Available
Florida (FL) Available
Georgia (GA) Available
Hawaii (HI) Not Available
Idaho (ID) Not Available
Illinois (IL) Available
Indiana (IN) Available
Iowa (IA) Available
Kansas (KS) Available
Kentucky (KY) Not Available
Louisiana (LA) Not Available
Maine (ME) Not Available
Maryland (MD) Not Available
Massachusetts (MA) Not Available
Michigan (MI) Not Available
Minnesota (MN) Not Available
Mississippi (MS) Available
Missouri (MO) Available
Montana (MT) Available
Nebraska (NE) Available
Nevada (NV) Available
New Hampshire (NH) Available
New Jersey (NJ) Not Available
New Mexico (NM) Available
New York (NY) Not Available
North Carolina (NC) Not Available
North Dakota (ND) Available
Ohio (OH) Available
Oklahoma (OK) Not Available
Oregon (OR) Not Available
Pennsylvania (PA) Not Available
Rhode Island (RI) Not Available
South Carolina (SC) Available
South Dakota (SD) Available
Tennessee (TN) Not Available
Texas (TX) Not Available
Utah (UT) Not Available
Vermont (VT) Available
Virginia (VA) Available
Washington (WA) Available
Washington DC Available
West Virginia (WV) Available
Wisconsin (WI) Not Available
Wyoming (WY) Available
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