Why is My Worker's Compensation Auditor Charging Me Premium for My Subcontractor?

Section 31-291 of the Connecticut Workers' Compensation Law stipulates that a principle employer is liable for injuries to employees of uninsured contractors and their uninsured subcontractors when the work pertains to the trade or business of the principle employer and the principle employer controls the premises where the work is performed. In order to avoid additional premium being charged on the contractor's policy for uninsured contractor employees, the contractor must furnish satisfactory evidence that the subcontractor has workers' compensation in force covering the work performed for the contractor. Per the manual, the following may be used to provide satisfactory evidence:

  • certificate of insurance for the subcontractor's workers' compensation policy;
  • certificate of exemption; or
  • copy of the subcontractor's workers' compensation policy.

If satisfactory evidence is not provided for each subcontractor, the company may charge an additional premium on the contractor's policy for the uninsured subcontractor's employees. Manual Rule 2-H-2 provides carriers with guidelines on how to charge additional premium when no satisfactory evidence is provided.




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