Workers Compensation Insurance in Texas

What Texas workers compensation insurance covers

Workers compensation insurance pays the medical care and part of the lost wages of an employee injured in the course and scope of employment, plus death benefits to a surviving family.

What the policy pays, in the order a claim usually moves:

• Medical treatment for the injury, with no deductible and no co-payment for the employee
• Income benefits replacing part of the wages lost while the employee cannot work
• Death and burial benefits when an injury kills an employee

The Texas Department of Insurance, Division of Workers’ Compensation regulates the system, sets the dispute process, and is the agency an employer or an employee deals with when a claim goes sideways.

A second half of the policy, employers liability, answers a suit brought against the employer rather than a benefit claim.

Is workers compensation required in Texas?

Texas does not require workers compensation from most private employers. Texas Labor Code §406.002 lets a private employer elect coverage, and an employer that declines becomes a non-subscriber rather than an employer in breach.

Where the coverage is still required:

• Public employers, and any employer another law brings inside the system, under Texas Labor Code §406.002
• A contractor on a public building or construction contract, under Texas Labor Code §406.096, and each of its subcontractors
• Any employer a private contract obliges, because a general contractor, a customer or a landlord can make coverage a condition of the work

Declining carries written duties either way: notice to the Texas Department of Insurance, Division of Workers’ Compensation under §406.004, notice to each employee under §406.005, and the annual filing 28 TAC §110.103(b)(1) sets between February 1 and April 30.

Why workers compensation is elective in Texas

Texas is the only state where workers compensation is elective for most private employers. Texas Labor Code §406.002 says that, apart from public employers and where other law requires it, an employer may elect to obtain coverage.

Election is not the end of the paperwork either way:

• Texas Labor Code §406.004 requires an employer who does not obtain coverage to notify the Texas Department of Insurance, Division of Workers’ Compensation in writing
• Texas Labor Code §406.005 requires that employer to notify each employee, at hire and on a posting at the workplace

Public construction runs the other direction. Texas Labor Code §406.096 requires a governmental entity entering a building or construction contract to make the contractor certify workers compensation coverage for every employee on the public project, and under §406.096(b) each subcontractor certifies to the general contractor, who forwards that certificate to the governmental entity.

What non-subscribing means in Texas

A non-subscriber is a Texas employer that elected not to carry workers compensation, a legal position rather than a gap in paperwork.

What changes for a non-subscriber:

• Texas Labor Code §406.033(a) removes three defenses in a suit by an injured employee: contributory negligence, assumption of risk, and the negligence of a fellow employee
• Texas Labor Code §406.033(d) still makes the employee prove the employer’s negligence, so losing those defenses is not strict liability
• The employee sues the employer directly, because the exclusive remedy in Texas Labor Code §408.001(a) reaches only an employee covered by workers’ compensation insurance coverage
• 28 TAC §110.103(b)(1) turns that written notice into an annual filing due between February 1 and April 30, with a first notice due 30 days after the first hire under §110.103(b)(2)

Aulona Insurance Group places the coverage for employers who elect it and takes no position on the election. That decision belongs to the business and its own attorney.

What Aulona Insurance Group can place

Aulona Insurance Group places workers compensation for Texas employers statewide, alongside the general liability, property, and commercial auto those employers usually need at the same time.

Inside the small-business program:

• Loss history under $20,000, with no more than two incidents in the past three years
• No prior carrier cancellation and no bankruptcy filing
• New businesses, with no minimum time in business

Workers compensation runs through its own market, separate from the small-business package markets, and is not limited by the revenue and payroll figures that apply to the other commercial lines. The class codes and the payroll split are what decide whether the account fits.

Luka Cenaj, the agency’s licensed principal, goes through the class codes and the payroll split on a recorded call, because the class split is what the end-of-term audit tests.

Where Aulona Insurance Group is not the right fit

Aulona Insurance Group cannot place workers compensation for every Texas employer, and an owner with a certificate deadline should hear that on day one. Which payroll classes the workers compensation market takes is settled on the recorded call, class code by class code, because the class split is what the market underwrites.

Life, health, Medicare, and disability coverage are not written at all, for any employer or any employee.

What moves the price of a Texas workers compensation policy

Payroll and class code set the premium on a Texas workers compensation policy, and the insurer applies rates it has filed with the Texas Department of Insurance.

What a workers compensation premium is built from:

• The class code assigned to each job, where a roofer and a receptionist sit at opposite ends of the same payroll
• Total W-2 payroll in each class, which is why the policy audits at the end of the term
• Claim history, which follows an employer through an experience modifier
• The split between office and field work, when the classification rules allow one

Aulona Insurance Group publishes no premium on this site and does not rank insurers by price. The number comes from the insurer that agrees to write the risk.

How a Texas workers compensation policy gets placed

Aulona Insurance Group starts a workers compensation account with a payroll conversation, because the application is mostly payroll and job descriptions.

Three steps:

1. Request a callback on this site, or call the agency directly, and leave a name, a number, and the type of business.
2. Take the call from Luka Cenaj and have the headcount, the payroll by job, the claim history, and any contract that demands a certificate or a waiver of subrogation to hand.
3. Let Aulona Insurance Group take the submission to the markets it holds appointments with.

No policy is quoted or bound without that call. Owners who prefer Albanian can have the whole conversation in Albanian.