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Comp Cover For Multi-State Firms Requires Extra Care

Agents and brokers were warned at an industry conference that workers' compensation coverage written for a business operation in one state won't protect that firm's operations in other jurisdictions.

By Mark E. Ruquet | Updated on February 17, 2010

Agents and brokers were warned at an industry conference that workers’ compensation coverage written for a business operation in one state won’t protect that firm’s operations in other jurisdictions.

That caution came during a recent continuing education session held at the Professional Insurance Agents of New York annual MertoRAP conference. Conducting a session titled, “Workers’ Compensation, Crossing State Lines,” Ivan Cohen of Insurance Education Corp. of Carmel, N.Y., advised agents that they are wrong to assume workers’ compensation coverage in one state will cover workers filing claims in a different state.

State laws and carrier contracts can limit or sometimes prohibit workers’ compensation payments in a state outside of where the policy is written, he noted. For clients with employees working in multiple states, an agent who believes that a single policy will cover all workers’ compensation claims can be in for a rude awakening and face personal liability when there is an out-of-state claim.

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