Why did I owe more after my workers' comp audit?

Premium is estimated at the start of the policy and corrected at audit using actual payroll. Higher payroll than estimated, a class code change, or uninsured subcontractors counted as your employees can all raise the final premium.

Do I need workers' comp for subcontractors?

If a subcontractor has no coverage of their own, your policy may be charged for their payroll at audit. Collecting a current certificate from each subcontractor is the usual way to show they are covered.

Is workers' compensation required in South Dakota?

South Dakota generally requires employers with employees to carry workers' compensation, with some exemptions. Confirm your situation with the South Dakota Department of Labor & Regulation or a licensed agent.

Coverage guide

Workers' compensation insurance

Workers' compensation pays medical bills and a portion of lost wages for employees injured or made ill by their work, and employer's liability covers lawsuits connected to those injuries. Most states require employers to carry it, and premium is driven by payroll, job classification codes, and your claims history, so accurate class codes and payroll matter at every renewal and audit.

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What workers' comp commonly covers

Who usually carries it

Businesses with employees (most states require it, with limited exemptions)
Contractors whose general contractors require proof of coverage
Owners deciding whether to include or exclude themselves, where state law allows

Commonly covered

Medical treatment for work-related injuries and illnesses
A portion of wages lost while an employee cannot work
Rehabilitation and, in serious cases, death benefits
Employer's liability for related lawsuits, up to the stated limits

Commonly excluded or limited

Independent contractors who are truly independent (classification rules are strict)
Injuries outside the course of employment
Employees in other states unless those states are listed on the policy
Owners and officers who have elected out, where allowed

This page is general information about how these policies commonly work. Every policy's own forms, endorsements, and exclusions decide what it covers. For advice about your business, talk with a licensed insurance agent.

Before your renewal or your next contract

What to check on your own policy

Class codes that match each employee's actual work
Estimated payroll compared with real payroll, to avoid audit surprises
States listed for employees who travel or work across state lines
Certificates of insurance collected from every subcontractor
Your experience modification factor, if your premium is large enough to have one
Employer's liability limits compared with what contracts require

Not sure what your policy says?

Upload your declarations page. The free AI coverage check lists your coverages, limits, and deductibles in plain language and flags items to discuss with a licensed agent.

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Industries that often ask about workers' comp

Workers' comp questions

Know what you're covered for before you need it.

Check your coverage free in about a minute, then talk with a licensed agent about anything you want to change or quote.