The Division of Workers' Compensation investigates all
information received or discovered about employers who may be uninsured for
workers' compensation. If an employer fails, neglects or refuses to
obtain
workers' compensation insurance as required by law, the Director of
the
Division is authorized to assess fines of up to $250.00 per day for
the first
violation and up to $500.00 per day for a second or any subsequent
violation.
In addition, a cease and desist order may also be issued against the
business to stop business operations until insurance is obtained.
The Colorado Workers’ Compensation Act does not provide a fund to cover the
medical expenses or lost wages of employees injured while working for an
uninsured employer. Employers have sole responsibility to provide insurance. If
an employer is determined to be uninsured at the time of an injury, s/he must
pay all statutory medical and disability benefits for the injured employee and
an additional 50% of all temporary, permanent and disfigurement benefits. For
additional employer information, request a copy of the Employer’s Guide or access the information via the division website by clicking on:
Guide for Employers
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- Commercial Insurance
- Insurance Enabled by Statute
- Self-Funding or Self-Insurance
The state of Colorado allows coverage by all three methods:
Commercial insurance for workers’ compensation may be purchased
from over three hundred carriers authorized to conduct such business
in the state of Colorado. Consumers of commercial insurance
often have cost advantages over prevailing insurance rates by innovative cost-plus and cash flow
plans that are available to select customers and “package deals”
wherein other coverages are discounted for the inclusion of the
workers’ compensation business. Changes in the laws and the
market may result in fluctuations in the types of plans that are
offered and in the availability of coverage from year-to-year.
Commercial carriers may endorse “all states” coverage.
- Insurance Enabled By Statute
Pinnacol Assurance is enabled by statute. Pinnacol is the
largest carrier of workers’ compensation in the State of Colorado.
It offers the full range of services that may be expected from a
commercial carrier. Coverage from Pinnacol is readily
available and a premium discount is offered. Pinnacol
Assurance coverage is restricted to claims occurring under Title 8
Articles 40 to 47, Colorado Revised Statutes, exclusively.
Colorado workers’ compensation statutes allow
for employers, meeting rigid financial and loss control standards,
to self-insure (self-fund) this risk. By special permit,
workers’ compensation obligations are paid directly from earnings
and assets of the employer within predetermined amounts set in
retention limits (deductible).
No matter which method is used to finance the
workers’ compensation risk, the employers and employees are subject
to the same laws and rules of procedure.
Self-insurance is permitted in 48 states,
American Samoa and the District of Columbia. In each of these
jurisdictions there are statutes enabling and rules governing the
respective self-insured programs.
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