Independent agency in Peoria, Arizona. Strategic Insurance Agency Alliance member.
Independent agency in Peoria, Arizona. Strategic Insurance Agency Alliance member.
Arizona requires workers compensation from the moment you employ someone. It pays an injured employee's medical costs and lost wages, and it is the policy that keeps a workplace injury from becoming a lawsuit against your business.
At a glance
Workers compensation in Arizona
Required from
Your first regularly employed worker. ARS 23-902.
What it pays
Medical treatment and a portion of lost wages for a work-related injury.
How it is rated
On payroll, by class code, adjusted by your claims experience over time.
Subcontractors
Uninsured subs can end up on your policy at audit. Collect their certificates.
Sole owners
Owners are often excludable, which changes the premium. Ask before assuming either way.
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Start here
Arizona Revised Statutes 23-902 makes employers subject to the workers compensation chapter as soon as they employ workers regularly employed in the business, with a narrow exception for domestic servants. In practice that means one employee, whether full time, part time, or seasonal.
"Regularly employed" in the statute includes work that runs for only part of the year, in the usual trade or business of the employer. A helper who works three months a summer is not outside it.
There is a second part of that statute worth reading if you use subcontractors. Where an employer procures work from a contractor and retains supervision or control over it, and the work is part of the employer's own trade or business, the contractor and their employees can be treated as employees of the original employer for these purposes. That is why general contractors collect certificates from every sub before letting them start.
Workers compensation is also protective for you. It is the mechanism through which workplace injuries are handled, which is what keeps them out of a general liability claim, and general liability specifically excludes employee injuries in any case.
Calling somebody a contractor does not settle it, and this is the distinction audits and claims turn on.
Treated as a contractor
Runs their own business, sets their own hours, supplies their own tools.
Should carry their own workers compensation and produce a certificate for it.
If they cannot, their pay can be treated as your payroll at audit.
ARS 23-902 can treat a supervised sub's crew as your employees for these purposes.
Treated as an employee
You direct the work, the schedule and the method.
They belong on your workers compensation policy from day one.
Their payroll is reported by class code and audited at year end.
Getting this right in advance is far cheaper than being told at audit or at claim.
What it pays
Medical and wages are what an injured employee sees. The other two are what protect the business.
602-480-6453Workers compensation
Declarations
Medical treatment
Care for a work-related injury or illness, from an urgent care visit through surgery and rehabilitation, without a deductible falling on the employee.
Lost wages
A portion of the employee's wages while they are unable to work, paid on a schedule set by state rules rather than negotiated.
Employer's liability
Defense and damages if an injury leads to a suit against the business, which is the coverage that keeps an injury from becoming an uninsured legal problem.
Certificates for the job site
General contractors will not let a crew on site without proof of workers compensation.
The certificate is the practical reason many businesses buy it before they legally must.
Illustration of how a declarations page is laid out. Not a real policy.
Where it sits
General liability covers harm you do to other people. Employees are explicitly not other people for that purpose; they are excluded. Workers compensation is the policy that fills that space, and there is no version of a business with employees where both are not needed.
Premium is calculated on payroll, split by class code, and then adjusted by your own claims experience. That means two things. First, class codes matter: a business coded into a higher-risk class than the work it actually does pays for the difference every month. Second, the audit at the end of the policy year is real, and payroll you did not report will be caught there.
Subcontractors are where audits hurt most. If a sub cannot produce evidence of their own coverage, their payments can be treated as your payroll at audit and charged accordingly. Collecting certificates as you go is a habit that pays for itself.
Workers compensation covers the one group general liability explicitly leaves out: your own employees.
Workers comp can feel like paperwork right up until someone on your crew gets hurt. We are a local independent agency with a growing list of commercial carriers, so we can shop your class codes widely and stay with you through the audit, not just the sale.
Workers compensation is where small businesses lose money quietly. Wrong class code, unreported payroll, uninsured subs, and an experience modifier nobody has looked at in five years. None of it shows up until the audit, and by then it is a bill rather than a decision.
What we check on a comp policy
Whether your class codes match the work your crew actually performs
Whether owners or officers can be excluded, and whether that is the right call
Whether you are collecting certificates from every subcontractor
Your experience modifier, and whether an old claim is still being charged
Whether the estimated payroll on the policy is realistic, so the audit is not a shock
This page is general information about how the coverage works and is not legal advice about your obligations as an employer. For a determination about your specific situation, the Industrial Commission of Arizona is the authority.
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Do I need workers compensation for one employee in Arizona?
Yes. Arizona Revised Statutes 23-902 makes employers subject to the workers compensation chapter once they employ workers regularly employed in the business, with a narrow exception for domestic servants. Part-time and seasonal work counts.
Do I need workers comp if I am the only person in my business?
A true sole proprietor with no employees is generally not required to carry it for themselves, and owners can often be excluded from a policy. That said, general contractors frequently require a certificate before you can work on their site, which is why many one-person businesses carry it anyway.
What happens if my subcontractor does not have workers comp?
Their payments can be treated as your payroll at your policy audit and charged as such, and depending on the arrangement their crew may be treated as your employees under ARS 23-902. Collect a current certificate from every subcontractor before they start.
How is workers compensation priced?
On your payroll, divided by class code for the type of work performed, then adjusted by your experience modifier, which reflects your own claims history. This is why accurate class codes matter so much: the wrong one raises every payroll dollar you report.
What is a premium audit?
At the end of the policy year the carrier compares the payroll you estimated against what you actually paid, by class, and adjusts the premium. Under-reporting produces a bill rather than a saving, so it is worth estimating honestly at the start.
Free and no obligation
At Shield of Faith Insurance, we make it easy to compare options for your business. Commercial auto, general liability, workers comp and a business owners policy can all sit with one local agent in Peoria, AZ.
Contact our Peoria office today to request your free, no-obligation insurance quote and discover how we can help you protect what matters most.
Call or text anytime during the business week. Evenings and Saturdays by appointment.
What happens next
1
Tell us about your business: the work, the vehicles and the crew.2
We compare several carriers for the whole package: auto, liability and workers comp.3
A real person from our office calls you back with options. No robo-dialers.Service area
We place workers compensation insurance in Arizona for employers across Peoria, Glendale, Surprise and the wider metro, including workers compensation insurance in Peoria, AZ. Workers comp insurance in Arizona is required from your first employee, and workers compensation insurance for small business is priced on payroll by class code, so accurate codes are worth more than shopping. Ask for workers comp insurance quotes before the first hire starts rather than after.
Get a commercial quote
Tell us about the business. We compare several carriers and call you back with options.
No robo-dialers and no spam calls. A local agent follows up personally. Sending this does not bind coverage.
Congratulations, that is a big step. Call us before the start date, because getting the class codes right at the beginning is worth more than any discount.
