Understanding your workers' compensation policy

The following information is intended for educational purposes only and is not intended to be nor should it replace legal advice.

Premium for workers' compensation insurance is based on factors such as the amount of wages paid by the employer and the type of work preformed (classification code) by the business.  Other factors may affect the classification such as your experience modifier.

CompSource offers a prompt pay discount of 1 percent of the total premium to policyholders who pay their monthly or quarterly premium on or before the due date.

Our premium billing department can be reached at (405) 232-7663, ext. 5105 or (800) 347-3863, ext. 5105 to explain your bill, give you a balance or help you with any other billing question you may have.

Workers’ compensation premiums do not automatically increase in the same way as auto or other liability insurance. However, policyholders whose claims experience is unusually adverse may receive a premium adjustment to more adequately reflect the account’s loss experience.

Working with an agent does not change or impact the policyholder’s premium rates.

If it is determined that an employer-employee relationship existed during the policy period with an uninsured subcontractor, CompSource will charge you additional premium for assuming the risk of a claim against you for an injury to a subcontractor and/or their employees.

The safest way to protect your business from claims and additional premium is to require certificates of workers' compensation insurance from all subcontractors before they begin working for your business.

For further information on how to determine if a subcontractor could be an independent contractor rather than an employee, view the question below, "How do I determine if a subcontractor is an independent contractor or an employee?".

There are many factors used when determining if a subcontractor is an employee or an independent contractor. Each situation is unique and therefore must be evaluated on a case-by-case basis. 

An independent contractor is defined by law as one who engages to perform certain services for another, according to his own manner, method, free from control and direction of his contractor in all matters connected with the performance of the service, except to the result or product of the work.

In general, an individual is an independent contractor if they are free from control of their work schedule and how the job will be done.

Conversely, an employee is an individual who is under the control of the employer who determines what, when and how the job will be done.

Click here to view the Affidavit of Exempt Status and the fact sheet that may assist you in determining if a subcontractor is an independent contractor or an employee.  Your premium auditor will require a Certificate of Insurance or a copy of the notarized Affidavit of Exempt Status form and the fact sheet for all subcontractors performing work during the policy period.

Policy coverage is effective at 12:01 a.m. the day after we accept the properly completed application, specified premium and any specially requested documents, forms or agreements; unless a future effective date has been arranged.

Approximately 45 days before the expiration of your current policy, you will receive a renewal packet with an Authorization to Renew form that must be signed by an officer, partner or sole proprietor and returned before the renewal date.

A Certificate of Insurance issued by an insurance provider certifies to a third party that you have workers' compensation coverage.

You may request a Certificate of Insurance from CompSource by clicking here to complete the Certificate of Insurance request form or by calling a member of our underwriting staff at (405) 232-7663, ext. 5107 or (800) 347-3863, ext. 5107.  When requesting a Certificate from CompSource, have available the name and address of the person or business requesting the Certificate.

If an employee’s contract of employment was entered into within the state of Oklahoma and the employee is injured or suffers occupational disease while temporarily working out of state, the employee may elect to file a claim in the state where the injury or occupational disease occurred. In this event, CompSource Oklahoma will pay the employee benefits as required in that state. In the absence of such election, the claim should be filed in Oklahoma and CompSource Oklahoma will pay benefits as required by Oklahoma law.

Yes, reporting a claim does not imply you agree that it was work-related.  When you report the claim, indicate that you question that it was work-related.

The Affidavit of Exempt Status and fact sheet were created pursuant to Oklahoma State law for any person who is not required to carry workers' compensation insurance.  The Affidavit and fact sheet are commonly presented to businesses to document an independent contractor's exemption.

Having a signed Affidavit does not in itself guarantee the person is an independent contractor; nor does the Affidavit release you from potential liability.  If it is determined that an employer-employee relationship exists, you will assume liability for any on-the-job accidents that occur with the subcontractor and/or their employees.  The safest way to protect your business from claims and additional premium is to require certificates of workers' compensation insurance from all subcontractors before they begin working for your business.

For further information on how to determine if a subcontractor is an independent contractor or employee view the question above, "How do I determine if a subcontractor is an independent contractor or an employee?".

The general contractor must obtain a Certificate of Insurance or a completed Affidavit of Exempt Status and fact sheet for all subcontractors hired.  If the subcontractor has employees or individuals performing work under their control and direction, the subcontractor is required by law to cover those employees under a workers' compensation policy.  If the subcontractor is believed to be an independent contractor, you should have the contractor complete an Affidavit of Exempt Status and fact sheet.  It is your responsibility to verify that individuals executing the Affidavit and fact sheet are truly independent contractors and that an employer-employee relationship does not exist.

Having a signed Affidavit does not in itself guarantee the person is an independent contractor; nor does it release you from potential liability.  If it is determined that an employer-employee relationship exists, you will assume liability for any on-the-job accidents that occur with the subcontractor and/or their employees.  The safest way to protect your business from claims and additional premium is to require certificates of workers' compensation insurance from all subcontractors before they begin working for your business.

For further information on how to determine if a subcontractor is an independent contractor or employee view the question above, "How do I determine if a subcontractor is an independent contractor or an employee?"  A list of statements that can help you decide if your subcontractor is an independent contractor is available here.

Each subcontractor must provide a Certificate of Insurance or a signed Affidavit of Exempt Status and fact sheet to the general contractor.  If completion of the exempt status fact sheet indicates the subcontractor is truly an independent contractor, the Affidavit should then be completed and signed by the subcontractor and notarized.  The Affidavit is good for the job/project or any similar job/project performed for the contractor for one year from the date of notary. However, the Affidavit should be reviewed periodically to verify that the contractor still qualifies for the independent contractor exemption.  The documents should also be reviewed if any changes are made to the scope of the work or it appears the independent contractor may have others working for them, even if the employees are not being paid.

Simply executing an Affidavit and fact sheet does not in itself make a subcontractor an independent contractor or release you from potential liability.  Further information on independent contractors and factors that assist in determining if an employer-employee relationship exists can be found by viewing the question above, "How do I determine if a subcontractor is an independent contractor or an employee?".

CompSource's premium auditor will ask to see a Certificate of Insurance and/or Affidavits of Exempt Status and fact sheets for each subcontractor you hired during the policy period.  The premium auditor will review each Affidavit of Exempt Status and fact sheet to determine if an employer-employee or independent contractor relationship existed.  If an employer-employee relationship existed, CompSource will assess premium on payments made to those workers to cover for assuming the risk of a claim against you for an injury to a subcontractor and/or their employees.

The Oklahoma Workers’ Compensation Code allows the Oklahoma Workers’ Compensation Court to make the determination on liability for claims based on the totality of evidence presented to the court. Execution of the Affidavit of Exempt Status establishes a rebuttable presumption that the person who signed it is not an employee for purposes of the Workers' Compensation Code. The contractor shall not be liable for injuries of any subcontractor, unless an employer-employee relationship is found to exist by the Court despite the execution of the Affidavit.

For more information on independent contractors, view the question above, "How do I determine if a subcontractor is an independent contractor or an employee?".  Additional information on what documentation a general contractor should request from a subcontractor is available in the above questions.