Alabama Workers Compensation Insurance

Alabama calls for you to have workers compensation insurance coverage if you have more than four employees, whether they are full-time or part-time, which also includes officers of the corporation. Employers of casual employees, domestic employees, and farm laborers or municipalities of less than 2,000 (according to recent federal census) are not obliged to supply coverage, but can elect to be covered by the provisions of the Alabama Workers Compensation Law.

Workers compensation coverage is required by law and is the exclusive coverage for on-the-job injury and work-related disease. Coverage provides limited civil liability and allows you to avoid double compensation and be protected from penalties and fines.

Workers compensation provides important benefits to both employees and employers. Workers compensation guarantees employees a "benefit certain" for any on-the-job injury or work-related disease. The employer is responsible to pay for this insurance and is sheltered by the "exclusive remedy" provisions of the Law.

Exemptions apply to employers with less than five employees and also to corporate officers.

Officers and members are considered employees if the company is incorporated or is an LLC. If a business has more than four employees, it is required to carry workers compensation by law. Yet, any officer may elect exemption by filing a WC15 (Officer Exemption Notice) with the employer's insurance carrier, Department of Industrial Relations, and Workers Compensation Division.

At the end the year, any corporate officer who has elected and been granted exemption, may repeal the exemption by filing a written notice with the Department and their insurance carrier. The election shall not reduce the corporation from continuing coverage for all other employees who may have been covered prior to the election or who may later be employed if the corporate officer does in fact elect to be exempt from coverage.

Partners and Sole Proprietors may be excluded unless they file an election agreeing to the provisions of the workers compensation law. Sole Proprietors or Partners must complete a WC14 Part I Form and file it with the workers compensation office. This WC14 will remain in effect until it is withdrawn by the Sole Proprietor or Partner which requires filing Part II of the WC14.