Locations: Florham Park, NJ and Marysville, PA

New Jersey, NJ Workers Compensation Insurance

Purchase NEW JERSEY, NJ WORKERS COMPENSATION INSURANCE for your business from Franchino Insurance.  We have the ability to take you out of the New Jersey Workers Compensation Insurance Plan (if qualified) and place you directly with a company saving the 20% surcharge.


  • CURRENTLY HAVE A WORKERS COMPENSATION POLICY – If you have workers compensation and want to know if you can save any money you will have to provide us with a copy of your current policy.  We need to see your policy data.  Call use at 973-377-6100.  After speaking with us you can email us a copy of your policy.

Workers compensation insurance provides 3 basic benefits.
It pays for: a) all medical bills resulting from injuries sustained on the job. no deductible b) 70% of loss of wages after 7 days, c) settlement determined by the NJ WC Bureau, if death, dismemberment, or permanent, disability occurs.Workers Compensation Injury

When do you need to purchase Workers Compensation?
The State of New Jersey requires all employers to provide workers compensation to all their employees.  A friend helping out, day laborer, illegal worker, anyone working for even one minute is considered an employee!

Learn more – Go to: WHO IS AN EMPLOYEE PAGE?

Corporate Officers / Corporations

Officers of a corporation are employees NOT owners!  All Corporations MUST have workers compensation in NJ  Corporate officers cannot reject coverage for themselves.

Individual, partnerships and LLC (limited liability companies) and election or rejection of coverage.

If you are an individual, partnership, LLC, or LLP, you can elect or reject coverage for yourself when purchasing coverage.  Once the decision is made it cannot be changed until the renewal of the policy. Please choose carefully when purchasing the policy.

General Contractors

If you are a general contractor, you should carry workers compensation insurance even if all your subcontractors carry workers comp.  If their policy cancels, the injured employee, owner / proprietor could seek benefits from you.  General Contractors MUST require all subcontractors to carry WC insurance, AND the proprietor MUST elect coverage.   A  general contractor should NEVER accept a certificate of insurance for workers compensation when the owner is excluded.  If the owner does any work and becomes injured, he or she can make a claim against the GC’s workers compensation policy.  In other words, anyone hiring subcontractors should ALWAYS request workers compensation from all sub contractors, helpers, day laborers, etc.  If they do not carry this coverage then you (GC) will be liability for their injuries and payroll.  An additional premium will be made upon completion of the mandatory audit.

Sub-Contractors without worker compensation coverage, (or you don’t collect their certificates of insurance), are considered as employees and whatever you paid them will be picked up as payroll.  You will be charged for them accordingly.  When you hire subcontractors with workers compensation insurance, their certificate of insurance MUST state that they have elected coverage for themselves (for individuals, partnerships, LLC, LLP).  If the certificate does not state this, then your workers compensation insurance company may not recognize the insurance coverage and charge you for the payroll of the proprietor, owner, partner, LLC or LLP member.  This does not apply if they are a corporation.


Subcontractors working for general contractors, large corporations, real estate management companies, or anyone that requires a certificate of insurance, MUST ELECT coverage for the proprietor / owner.  When certificates of insurance are issued, they specifically describe that the proprietor, owners, partner, LLC or LLP member has ELECTED or REJECTED coverage.

Cost of Workers Compensation Insurance

The determination of the WC premium is based on a rate established by the State of NJ Workers Compensation Bureau (every Jan1st) times the payroll. (plus a few small fees and/or credits, to keep things simple).  The premium is based on salary / payroll / net income / any compensation paid to owners or employees.


The policy is written with an estimated annual payroll.  At the end of the policy term, the company will contact you to conduct an audit to determine the actual amount you paid your employees (and proprietors if coverage has been elected).  An adjustment to your policy will be issued.  If you have a higher payroll than estimated, then the company will charge you an additional premium.  If you have a lower payroll than estimated, then the company will refund the overpaid premium.

Workers Compensation for States other than New Jersey

A New Jersey workers compensation policy is intended for New Jersey employees only.  A “regular” NJ employee is on who has NJ tax withholdings taken from his or her paycheck, works in New Jersey, and lives in New Jersey.  If an employee is hired from another state and / or will primarily work in another state, then workers compensation for that state needs to be purchased; not NJ workers comp.

Employers Liability

Workers Compensation includes part II a/k/a Employers Liability, that is rarely used.
Employers Liability provides protection to the employer from situations where an injured employee has the right to bring civil tort action for damages despite the provisions of the NJ WC statute.  This type of suit is not covered under workers compensation insurance and is specifically excluded in general liability insurance.  To avoid a coverage gap, employers liability insurance is included as an additional coverage in workers compensation policies. The following are some examples of claims that would be covered under employers liability insurance.

The maximum limits for employers liability are . . .

  • 1 million bodily injury by accident, each accident
  • 1 million bodily injury by disease, each employee
  • 1 million bodily injury by disease, policy limit

Suit is filed by injured employees who is excluded under WC law.  For example, many states WC laws exclude farm labor and domestic employees.  (not in NJ)

Suit brought by an injured employee who is illegally employee.  In certain instances illegally employed minors or illegal aliens are not entitled to WC benefits and may elect to sue the employer under common law.

Intentional act claim due to an intentional wrong by the employer.

Suit brought by an injured employee’s spouse claiming loss of consortium.  Under common law a man or woman is entitled to the “services” of his or her spouse.  These services include sexual relations, companionship, and help in performing household chores and maintenance.

Suite filed against the employer by a family member of the injured employee claiming a consequential bodily injury.  For example, the spouse of a severely injured employee might upon learning of the injury suffer a heart attack, nervous breakdown, etc.


Who Must be Insured by Workers Compensation in NJ?

Employers Guide to Workers Compensation in NJ

Link to NJ Department of Labor Website

Questions and Answers about Workers Compensation

Workers Compensation for Subcontractors working for General Contractors

Definition of Payroll in Workers Compensation