What Are Workers Compensation Insurance Endorsements?
What Are Workers Compensation Insurance Endorsements?. A workers compensation insurance endorsement can either add, remove or exclude certain coverages. It's a form that becomes part of your insurance policy, altering your policy coverage.
For example, any changes made to the basic policy the commercial insurance carrier files with the state regulators is done by using endorsements. Common changes might include: Changing the business address, adding more coverage, excluding coverage for specific exposures. Workers Compensation Endorsements allow you to make these changes - without having to buy another policy or take the chance of having risks go uninsured.
The National Council on Compensation Insurance, Inc. (NCCI) has developed and filed two types of endorsements in the states where it has jurisdiction. Standard endorsements can be modified only as NCCI permits.
On the other hand, advisory endorsements are only advisory and may be used or modified almost any way the insurance company believes necessary, subject to making proper filings with the state authority that has jurisdiction.
So what are workers compensation insurance endorsements? Read on to discover the many types of endorsements available for Workers Compensation and Employers Liability policies.
What are workers compensation insurance endorsements? Endorsements modify the basic Workers Compensation and Employers Liability policy to either add, delete, or exclude certain types of coverage.
WORKERS COMPENSATION ENDORSEMENTS NUMBERING
- What Are 01-Federal Coverages and Exclusions?
- What Are 02-Maritime Coverages and Exclusions?
- What Are 03-Other Coverages and Exclusions?
- What Are 04-Premium Endorsements?
- What Are 05-Retrospective Premium Endorsements?
- What Are 06-Miscellaneous Endorsements?
So what are workers compensation insurance endorsements Workers Compensation and Employers Liability endorsements are numbered in a specific format that designates the type of endorsement, the way it is used, the version or edition, and the state where it applies. The number starts with WC and is then followed by three separate two-digit sequences and possibly a letter.
The first two digits establish wherever the form is nationwide or applies to a specific state. If 00 is used, the form is a countrywide form. If any of the numbers below are used, the endorsement is a state specific form.
|District of Columbia||08|
The numbers 89 are for miscellaneous endorsements and 99 is reserved for proprietary forms of a specific insurance company.
The second two-digit sequence identifies the type of endorsement. They are:
- 01-Federal Coverages and Exclusions
- 02-Maritime Coverages and Exclusions
- 03-Other Coverages and Exclusions
- 05-Retrospective Premium
- 06-Miscellaneous Endorsements
The third 2-digit sequence is the individual sequence number of the endorsement. It differentiates that specific endorsement from other endorsements of the same type, in the same state, or within the same series.
The final alpha character identifies the version or a later edition of the endorsement. If there is no alphabetical character at the end, the endorsement is the only version or edition ever produced. The letter "A" indicates the first revision, "B" the second, and so forth.
WORKERS COMPENSATION AND EMPLOYERS LIABILITY INSURANCE POLICY ENDORSEMENTS
Note: This analysis addresses only countrywide endorsements.
What Are 01-Federal Coverages and Exclusions?
The 01-Federal Coverages and Exclusions are as follows:
WC 00 01 01 A-Defense Base Act Coverage Endorsement
The Defense Base Act extends the United States Longshore and Harbor Workers' Compensation Act (USL&HWCA) to apply to contractors that perform work at overseas military bases. The bases may be in a United States territory or possession or may be in a foreign country. The USL&HSCA is also extended to apply to various public works contracts being performed outside the continental United States but only if listed and described on the endorsement schedule. This endorsement provides the required coverage.
WC 00 01 02 B-Federal Coal Mine Health and Safety Act Coverage Endorsement
This endorsement is used when the policy covers exposures subject to the Federal Coal Mine Health and Safety Act. Federal Black Lung Workers Compensation Insurance is provided in states (including monopolistic state fund states) listed on the endorsement schedule. Changed to add et seq to remove need to update endorsement due to numbering changes in the law.
WC 00 01 04 A-Federal Employers Liability Act Coverage Endorsement
The Federal Employers Liability Act (FELA) makes interstate railroads liable for bodily injuries that their employees sustain. Such employees are not subject to state workers compensation laws. Part Two, Employers Liability Insurance, insures the railroad's liability unless the Federal Employers Liability Act Exclusion Endorsement specifically excludes it. This endorsement applies to work done subject to this Act and any amendments to it that take effect during the policy period.
WC 00 01 06 A-Longshore and Harbor Workers' Compensation Act Coverage Endorsement
The United States Longshore and Harbor Workers' Compensation Act (USL&HWCA) is a federal workers compensation law that applies to workers engaged in maritime employment who are not seamen. This endorsement provides workers compensation insurance and employers liability insurance for work subject to USL&HWCA in any state (including monopolistic state fund states) listed on the endorsement schedule.
WC 00 01 08 A-Nonappropriated Fund Instrumentalities Act Coverage Endorsement
The Nonappropriated Fund Instrumentalities Act (NFIA) makes the Longshore and Harbor Workers' Compensation Act apply to civilian employees of certain instrumentalities. This endorsement provides workers compensation insurance and employers liability insurance for employees working at locations listed and described on the endorsement schedule subject to the NFIA.
WC 00 01 09 C-Outer Continental Shelf Lands Act Coverage Endorsement
The Outer Continental Shelf Lands Act (OCSLA) makes the Longshore and Harbor Workers' Compensation Act apply to work that involves developing natural resources of the Outer Continental Shelf from fixed platforms that must be listed on the endorsement schedule. This endorsement provides workers compensation insurance and employers liability insurance for employees working on the Outer Continental Shelf subject to the Act. Changed to add et seq to remove need to update endorsement due to numbering changes in the law.
WC 00 01 11-Migrant and Seasonal Agricultural Worker Protection Act Coverage Endorsement
This endorsement removes Exclusion from Part Two-Employers Liability 12 but only for the work described and at the locations listed in the schedule.
What Are 02-Maritime Coverages and Exclusions?
The 02-Maritime Coverages and Exclusions are as follows:
WC 00 02 01 B-Maritime Coverage Endorsement
This endorsement provides Jones Act required coverage for maritime operations. Exclusion 14 in the endorsement is amended to clarify that even when premium is paid to remove this exclusion that punitive damages related to this exclusion continue to not be covered.
WC 00 02 03-Voluntary Compensation Maritime Coverage Endorsement
This endorsement can be used only if WC 00 02 01 A-Maritime Coverage Endorsement is also used.
This endorsement changes the Jones Act coverage from negligence based to a Workers Compensation Coverage base basis using the listed state's workers compensation law as its base of coverage.
WC 00 02 04-Limited Maritime Coverage Endorsement
This is only an advisory endorsement. Part Two Employers Liability Insurance C. Exclusion 10 excludes bodily injury to a vessel's master and crewmembers.
This endorsement deletes that exclusion with respect to the listed code numbers and classification phraseology listed on the endorsement schedule.
This endorsement can be used when non-maritime type employees have a connection with the vessel. Some examples are trades people or caterers.
What Are 03-Other Coverages and Exclusions?
The 03-Other Coverages and Exclusions are as follows:
WC 00 03 01 A-Alternate Employer Endorsement
This endorsement is used to protect a client from being considered a statutory employer for the named insured's employees while those employees work on the client's premises and/or under the client's direction.
WC 00 03 02-Designated Workplaces Exclusion Endorsement
This endorsement excludes coverage for work or at workplaces listed in the space provided on the endorsement schedule. It may be used when a wrap-up program provides workers compensation coverage for a particular job. The named insured can eliminate all payroll associated with that workplace.
WC 00 03 03 C-Employers Liability Coverage Endorsement
This endorsement eliminates all workers compensation coverage for any state listed on the endorsement schedule. This results in coverage being provided for only employers liability. It can be used as a way to provide employers liability coverage in monopolistic states or to provide only employers liability coverage when all employees are exempt from mandatory workers compensation coverage.
WC 00 03 04-Insurance Company as Insured Endorsement
This endorsement is used when the named insured is an insurance company that provides workers compensation insurance or reinsurance. It removes coverage for any obligation that named insured has to other insured's workers compensation losses.
WC 00 03 05-Joint Venture as Insured Endorsement
This endorsement adds members of a joint venture as insureds. Coverage applies only with respect to the member's capacity as the employer of the joint venture's employees.
WC 00 03 06-Medical Benefits Exclusion Endorsement
This endorsement is used if the named insured is a qualified self insurer of medical benefits. It excludes all coverage for medical benefits required by the workers compensation law of any state listed on the endorsement schedule under Part One-Workers Compensation Insurance.
WC 00 03 07-Medical Benefits Reimbursement Endorsement
This endorsement is used if the insurance company and the named insured agree that the named insured pays for all medical payments that the workers compensation law requires. It is used only when the state does not consider the named insured to be a qualified self-insurer.
WC 00 03 08-Partners, Officers, and Others Exclusion Endorsement
This endorsement is used to exclude specific individuals or groups of individuals from workers compensation and employers liability coverage. However, each state dictates the ability to use this endorsement. State law provides guidance on who can and who cannot refuse coverage. When used, it must be done very carefully because the named insured may be responsible for significant costs for which there is no insurance.
WC 00 03 09 B-Rural Utilities Service Endorsement
This endorsement is used if the named insured is a rural electrification cooperative and if the Rural Electrification Agency (R.E.A.) requires it. It specifies that the named insured will submit the policy, endorsements, and forms to the R.E.A. before it goes into effect and that the R.E.A. will be notified at least ten days prior to the effective date of cancellation if coverage is cancelled. It also has conditions that address tort liability and immunity with respect to adjusting claims, defending suits, and other legal actions.
WC 00 03 10-Sole Proprietors, Partners, Officers, and Others Coverage Endorsement
This endorsement is the opposite of WC 00 03 08 because it adds coverage for individuals who are usually exempt from coverage. Individuals may be specifically named or may be identified as groups, such as all partners or all executive officers (except the president). The remuneration for each individual added must be added to the premium basis.
WC 00 03 11 A-Voluntary Compensation and Employers Liability Coverage Endorsement
This endorsement adds Voluntary Compensation coverage to the policy.e
WC 00 03 12 A-Voluntary Compensation and Employers Liability Coverage for Residence Employees Endorsement
This endorsement provides Voluntary Compensation coverage and Employers Liability coverage but for only domestic workers. It can be added to a workers compensation policy or to homeowners' policies, comprehensive personal liability policies, or any other policy that provides similar personal liability coverage. It is used when coverage for such workers is not mandatory.
WC 00 03 13-Waiver of Our Right to Recover from Others Endorsement
This endorsement is used to waive the insurance company's rights of subrogation against named third parties that are listed on the endorsement schedule that may be held responsible for an injury.
WC 00 03 14 A-Workers Compensation and Employers Liability Coverage for Residence Employees Endorsement
This endorsement is used to provide the statutory workers compensation obligations of an insured employer of domestic workers. It is designed to be added to homeowners' policies, comprehensive personal liability policies, or any other policy that provides similar personal liability coverage
WC 00 03 15-Domestic and Agricultural Workers Exclusion Endorsement
This endorsement is used to exclude all coverage for farm or agricultural workers and/or for domestic or household workers. Individuals may be specifically listed or be described on the endorsement schedule, such as all farm or agricultural workers and employees or all domestic or household workers. It can be used in only states whose law allows using it.
WC 00 03 19-Employee Leasing Client Endorsement
This endorsement is used to allow an employee-leasing firm to not report payroll for employees leased to others under contract. Information regarding the contract must be entered on the schedule and the client must prove they have obtained the necessary coverage and have certificates of insurance to prove it.
WC 00 03 20 B-Professional Employer Organization (PEO) Extension Endorsement
This endorsement is added to the policy of a client who leases employees from a PEO. The client agrees to provide the mandatory workers compensation coverage for the employees it leases from the PEO but only for those supplied under the designated contract and in the listed state(s) on the endorsement schedule.
WC 00 03 21 A-Professional Employer Organization (PEO) Exclusion Endorsement
This endorsement excludes coverage for workers the named insured leases to specific clients. The policy this endorsement is part of does not cover workers the named insured leases to any client listed on the endorsement schedule or others added after the policy is issued, even if they are not actually endorsed to the policy. Changes that involve such information must be reported to the insurance company immediately.
WC 00 03 22 A-Professional Employer Organization (PEO) Client Exclusion Endorsement
This endorsement excludes leased workers from the named insured's policy and covers only its direct employees. A policy with this endorsement does not cover any workers leased from the PEO listed on the endorsement schedule and any PEO used after the policy's inception date, even if not endorsed.
WC 00 03 23 A-Multiple Coordinated Policy Endorsement
This endorsement is used on policies issued to clients of a Professional Employer Organization (PEO) to provide coverage for workers leased from that PEO on a multiple coordinated policy basis. Coverage does not apply to any other workers, whether leased or not. A separate policy must be issued to each client company to cover all other employees.
WC 00 03 24-Workers Compensation Insurance Plan-Other States Endorsement
This endorsement is attached to all policies written under the Workers Compensation Insurance Plan (WCIP) (also known as the Assigned Risk Plan). It amends A. 3. and A. 4. under Part Three-Other States Insurance. Under A. 3, the insurance company reimburses the named insured for benefits that the workers compensation law of that state requires meaning that there is no direct payment to the injured employee. Under A. 4, if the named insured has work on the effective date of this policy in any state listed under Item 3.C. of the Information Page, coverage is not provided for the state unless the insurance company is notified within 30 days.
WC 00 03 25-Residual Market Multiple Company Endorsement
This endorsement is used when affiliated companies are providing residual market workers compensation and employers liability coverage in states other than the primary location state. Each state listed under Item 3.A. of the Information Page is entered under Schedule A and the insurance company that provides coverage in that state is entered in Schedule B.
WC 00 03 26 A-Residual Market Limited Other States Insurance Endorsement
This endorsement is used on policies written in the residual market. It deletes Part Three-Other States Insurance in the policy. It then adds back a more restricted version of Part Three.
What Are 04-Premium Endorsements?
The 04-Premium Endorsements are as follows:
WC 00 04 01 A-Aircraft Premium Endorsement
This endorsement states the additional premium required for each aircraft listed on the endorsement schedule for Classification Code 7421-Aviation-Transportation of Personnel in Conduct of Employer's Business-Flying Crew. Passenger seat surcharges are made separately.
WC 00 04 02-Anniversary Rating Date Endorsement
This endorsement states the Normal Anniversary Rating Date (NARD) when it is different than the policy effective date.
WC 00 04 03-Experience Rating Modification Factor Endorsement
This endorsement is used when the named insured's experience rating modification factor is not available when the policy is issued. The insurance company endorses the policy to reflect the correct factor when it is determined.
WC 00 04 04-Pending Rate Change Endorsement
This endorsement is used if the rates on the policy when it is issued may be changed because of a pending rate change filing by the regulatory authority that has jurisdiction. If the pending rate filing results in different rates than the ones used on the policy, the insurance company endorses the new rates and the effective date of change. It is used if there is only one state under Item 3. A. on the Information Page. If there is more than one state, this endorsement applies to only the state(s) listed on the endorsement schedule.
WC 00 04 05-Policy Period Endorsement
This endorsement is used if the policy period is more than one year and sixteen days and does not consist of complete twelve-month periods.
WC 00 04 06 A-Premium Discount Endorsement
This endorsement states how the Premium Discount rules in the Basic Manual of Workers Compensation and Employers Liability Insurance apply.
WC 00 04 07-Rate Change Endorsement
This endorsement is used when a rate change occurs after the policy was issued. The date of the change and the state it affects must be entered on the endorsement schedule. If the increase applies to all classifications in the state, that percentage is entered. However, the change for each code must be entered if the rate change varies by classification.
WC 00 04 08-Longshore and Harbor Workers' Compensation Act Rate Change Endorsement
This endorsement is used when a rate change that affects the Longshore and Harbor Workers' Act classifications occurs after the policy was issued. The date of the change and the state it affects must be entered on the endorsement schedule. If the increase applies to all classifications in the state, that percentage is entered. However, when the change is specific to a classification, each code to which it applies must be listed.
WC 00 04 09-Premium Determination Endorsement-Former Self-Insurers 1
This is an assigned risk endorsement. It must be attached if the employer was self insured within 12 months of applying for this coverage. It is not used if the employer is a self-rated risk as determined by the applicable workers compensation insurance rating organization's filed experience rating plan, on policies subject to retrospective rating, or for more than three consecutive years for the same employer.
WC 00 04 10-Premium Determination Endorsement-Former Self-Insurers 2
This is an assigned risk endorsement. It is similar to WC 00 04 09 but is different because it states that the premium does not include an "insurance charge."
WC 00 04 11-Assigned Risk Premium Differential Endorsement
This is an assigned risk endorsement. It is used when the named insured has work in more than one state. It states the rate and premium for the states listed on the endorsement schedule.
WC 00 04 12-Contingent Experience Rating Modification Factor Endorsement
This endorsement is used on policies subject to an experience rating modification factor. The factor on the endorsement schedule is a Contingent Experience Rating Modification Factor based on available experience data and replaces any previous experience modification factor. The insurance company issues an endorsement that states the revised factor when and if the required additional experience data becomes available. The contingent factor applies until and unless a revised factor is subsequently issued.
WC 00 04 13-Assigned Risk Premium Surcharge Endorsement
This endorsement applies a residual market surcharge based on the entire standard premium according to the state rate pages that apply.
WC 00 04 14-Notification of Change in Ownership Endorsement
This mandatory endorsement is used on all policies to inform the named insured that ownership changes as detailed in the endorsement must be reported to the insurance company within 90 days after the change takes place.
WC 00 04 15 B-Assigned Risk Adjustment Program Endorsement
This endorsement integrates additional provisions under Part Five-Premium because one or more states listed under Item 3. A. on the Information Page approved the Assigned Risk Adjustment Program (ARAP). ARAP surcharges the premiums of assigned risk employers that meet its criteria.
WC 00 04 17 B-Assigned Risk Loss Sensitive Rating Plan Notification Endorsement
This endorsement is used with every assigned risk policy. The Loss Sensitive Rating Plan (LSRP) is a mandatory program for risks in the assigned risk market that meet the eligibility threshold. It details eligibility criteria, deposit/initial premium and LSRP contingency deposit, effect of changes in LSRP standard premium, and penalties for evading LSRP. It applies to states listed on the endorsement schedule.
WC 00 04 18 F-Assigned Risk Loss Sensitive Rating Plan Endorsement
This endorsement is added to Part Five-Premium and explains how the Assigned Risk Loss Sensitive Rating Plan (LSRP) premium is calculated.
WC 00 04 19-Premium Due Date Endorsement
This mandatory endorsement makes the Workers Compensation and Employers Liability Insurance Policy conditions comply with the National Association of Insurance Commissioners (NAIC) Statement of Statutory Accounting Principles No. 6. It adds the due date for audits and retrospectively rated policy premiums so that uncollected audit premiums are treated as an admitted asset.
WC 00 04 20-Terrorism Risk Insurance Act Endorsement
WC 00 04 21-Domestic Terrorism, Earthquakes and Catastrophic Industrial Accidents Premium Endorsement
WC 00 04 21 C-Catastrophe (Other than Certified Acts of Terrorism) Premium Endorsement
WC 00 04 22 A-Terrorism Risk Insurance Program Reauthorization Act Disclosure Endorsement
WC 00 04 23-Assigned Risk Loss Sensitive Rating Plan Notification Endorsement for Professional Employer Organization (PEO) and Temporary Arrangements
This endorsement informs the named insured that it may become subject to the assigned risk mandatory Loss Sensitive Rating Plan (LSRP) during the term of the policy or its renewal, resulting in a change in its workers compensation policy cost. It must be added to assigned risk policies of any size in states that have approved the LSRP covering professional employer organizations (PEOs) and other organizations that offer similar temporary employment arrangements.
What Are 05-Retrospective Premium Endorsements?
The 05-Retrospective Premium Endorsements? are as follows:
WC 00 05 01-Retrospective Premium Endorsement-Rating Options I, II, III, or IV-One Year Plan
This endorsement is used for the Rating Options I, II, III, or IV of the Retrospective Rating Plan with a one-year rating plan period. This is used when a named insured is eligible to be under a Rating Options I, II, III, or IV retrospective rating plan and has elected to do so. The rating plan period is the one-year period beginning with this endorsement's effective date.
WC 00 05 02-Retrospective Premium Endorsement-Rating Options I, II, III, or IV-Three Year Plan
This endorsement is used for the Rating Options I, II, III, or IV of the Retrospective Rating Plan with a three-year rating plan period. This is used when a named insured is eligible to be under a Rating Options I, II, III, or IV retrospective rating plan and has elected to do so. The rating plan period is the three-year period beginning with this endorsement's effective date.
WC 00 05 03 C-Retrospective Rating Plan Premium Endorsement-One-Year Plan
This endorsement is used for a one-year rating plan period. This is used when a named insured is eligible to be under a retrospective rating plan and has elected to do so. The rating plan period is the one-year period beginning with this endorsement's effective date.
WC 00 05 04 V-Retrospective Rating Plan Premium Endorsement-Three-Year Plan
This endorsement is designed for a three-year rating plan period. This is used when a named insured is eligible to be under a retrospective rating plan and has elected to do so. The rating plan period is the three-year period beginning with this endorsement's effective date.
WC 00 05 05 C-Retrospective Rating Plan Premium Endorsement-Wrap-up Construction Project
This is used when a named insured‘s long term construction project is eligible to be under a retrospective rating plan and has elected to do so. The rating plan period is the length of the construction project on the Information Page and begins with this endorsement's effective date.
WC 00 05 08-Retrospective Premium Endorsement-Aviation Exclusion
This endorsement is used when an agreement is made that the aviation exposures of a risk are not subject to any retrospective rating plan. Any codes and classifications that apply are listed on the endorsement schedule.
WC 00 05 09-Retrospective Premium Endorsement-Changes
This endorsement is used when the Excess Loss Premium Factor, the Retrospective Development Factors or tax multiplier is changed.
WC 00 05 09 A-Retrospective Premium Endorsement-Changes
This endorsement is used to change the Excess Loss Premium Factor, the Retrospective Development Factors, the Tax Multiplier, and to list the states where the Retrospective Development Factor does not apply.
WC 00 05 10 A-Retrospective Rating Plan Premium Endorsement-Nonratable Catastrophe Element or Surcharge
This endorsement changes the standard premium and incurred losses portions of the retrospective rating plan premium endorsement attached to the policy to eliminate the nonratable catastrophe premium surcharge and also to eliminate certain catastrophic losses that may have incurred.
WC 00 05 11-Retrospective Premium Endorsement-Short Form
This endorsement is used if the named insured has more than one policy subject to the same retrospective rating option to identify the policy number that includes the applicable Retrospective Rating Plan Premium Endorsement.
WC 00 05 12 C-Retrospective Rating Plan Premium Endorsement-One-Year Plan-Multiple Lines
This is similar to WC 00 05 03 C-Retrospective Rating Plan Premium Endorsement-One-Year Plan except that it includes multiple lines of business.
WC 00 05 13 C-Retrospective Rating Plan Premium Endorsement-Three-Year Plan-Multiple Lines
This endorsement is similar to WC 00 05 04 C-Retrospective Rating Plan Premium Endorsement-Three-Year Plan except that it includes multiple lines of business.
WC 00 05 14 C-Retrospective Rating Plan Premium Endorsement-Wrap-Up Construction Project-Multiple Lines
This endorsement is similar to WC 00 05 05 C-Retrospective Rating Plan Premium Endorsement-Wrap-up Construction Project except that it includes multiple lines of business.
WC 00 05 15 A-Retrospective Rating Plan Premium Endorsement-Flexibility Options
This endorsement changes the retrospective rating plan premium endorsement attached to the policy by permitting presenting thee options that can be selected by the insurance company and the named insured to modify the retrospective rating plan.
WC 00 05 16-Retrospective Rating Plan Premium Endorsement-Large Risk Alternative Rating Option (LRARO)
This endorsement applies only to workers compensation and employers liability coverage that has been rated under provisions of a negotiated Large Risk Alternative Rating Option (LRARO) and is subject to a retrospective rating plan.
What Are 06-Miscellaneous Endorsements?
The 06-Miscellaneous Endorsements are as follows:
WC 00 06 03-Benefits Deductible Endorsement
This endorsement applies to only Part One-Workers Compensation Insurance. It lists the amounts and types of deductible selected that apply. The deductible applies separately to each claim for bodily injury by accident or disease unless a law requires payment on a per-accident or per-disease basis. In those cases, the deductible applies separately to each accident or disease, regardless of the number of persons who sustain injury by such accident or disease.
What Are Workers Compensation Insurance Endorsements? - The Bottom Line
What are workers compensation insurance endorsements? An endorsement alters the Workers Compensation Program policy and becomes part of your commercial insurance agreement, and it remains in force until the contract term expires.
The only exception to the above rule is if the workers compensation endorsement has a specific or limited term to which the endorsement is valid. It may renew under the same terms and conditions of the rest of your policy.
Additional Commercial Insurance Endorsements Information
Learn about small business commercial endorsements that add, remove, or change your policy's coverage by altering the standardized coverage form.
- What Are Businessowners Policy Insurance Endorsements?
- What Are Commercial Auto Insurance Endorsements?
- What Are Commercial Crime Endorsements?
- What Are Commercial General Liability Insurance Endorsements?
- What Are Commercial Property Insurance Endorsements?
- What Are Commercial Umbrella Insurance Endorsements?
- What Are Cyber Insurance Endorsements?
- What Are Employment-Related Practices Liability Insurance Endorsements?
- What Are Farm And Ranch Insurance Endorsements?
- What Are Time Element Insurance Endorsements?
- What Are Workers Compensation Insurance Endorsements?
So commercial insurance endorsements allow you to customize your policy to better fit your business insurance needs without having to buy a new policy.
So business insurance endorsements can either modify the basic policy by removing coverages that you don’t need, or remove one or more exclusions, adding those coverages back into the policy.
There are many types of commercial insurance endorsements - and while some favor the insurer (by excluding coverage) and some benefit the insured (by adding coverage), below is a list of some of the most common uses for business insurance endorsements:
- Additional Insured: This is one of the most common endorsements that adds someone other than you to your insurance policy. It is typically required by some sort of contract. Common additional insureds are landlords, general contractors, vendors or customers.
- Administrative Changes: Newly issued policies can include mistypes, misspellings, or missing words altogether. To correct these errors, the insurer would add an endorsement, rather then having to cancel and issue a new policy. If a policyholder changes their name, an endorsement would reflect that too.
- Changing Or Adding Addresses: This endorsement covers any change to the insured's property like moving your office to a new location, or expanding to a another location.
- Deductible Changes: This endorsement manages who can change your deductible as well as when and how much it can be changed.
- Increased Limits: Occasionally companies need to add endorsements to increase the limits of insurance. For example, you'd use an endorsement to extend workers' compensation benefits not covered by state law. Or, to get a contract you need higher limits on your general liability policy.
Making a policy change usually affects your insurance premium. Anytime coverage is altered there is likely a cost associated with how the policy premium is calculated. Adding coverage usually makes the premium increase, while excluding coverage can reduce the premium you pay.
Additional Resources For Workers Compensation Insurance
Learn about workers compensation insurance - a policy provides medical, wage and other benefits to employees who are injured or become ill on the job. Workers comp coverage is mandated by each state.
- Employers Liability
- What Are Workers Compensation Insurance Endorsements?
- Workers Compensation Class Codes
- Workers Compensation Insurance
- Workers Compensation Insurance Laws
The National Council on Compensation Insurance, Inc. (NCCI) developed WC 00 00 00 B-Workers Compensation and Employers Liability Insurance Policy.
It covers the named insured's statutory liability under various state workers compensation laws or acts.
It provides defined benefits to employees for injuries they sustain or diseases they contract that arise out of and in the course of their employment.
All states have laws that require such protection for workers, and those laws prescribe the amount and duration of the benefits provided.
Employers Liability covers an employer's common law or tort liability for employee injuries that fall outside the scope of the state laws or acts. This liability is separate and distinguished from the liability that workers compensation laws impose.
The policy provides the mandatory benefits that the various state laws prescribe and require for accidental work-related injuries that occur in the course of employment, subject to its terms and conditions.
It must be emphasized that the injury must arise from and be related to the injured worker's job duties. Coverage also applies to the related costs for disease or death that occur as a result of the accident.
There are times when the employed worker's injury is not compensable under workers compensation or occupational disease laws. In those cases, Employers Liability coverage responds to the injured worker's allegations of negligence on the employer's part, subject to its terms, conditions, limitations, and exclusions.
The coverage the basic policy provides may be broadened, restricted, clarified, or made to comply with specific state regulatory requirements by using a variety of available endorsements.
Types Of Small Business Insurance - Requirements & Regulations
Perhaps you have the next great idea for a product or service that you know will appeal to your local area. If you've got a business, you've got risks. Unexpected events and lawsuits can wipe out a business quickly, wasting all the time and money you've invested.
Operating a business is challenging enough without having to worry about suffering a significant financial loss due to unforeseen and unplanned circumstances. Small business insurance can protect your company from some of the more common losses experienced by business owners, such as property damage, business interruption, theft, liability, and employee injury.
Purchasing the appropriate commercial insurance coverage can make the difference between going out of business after a loss or recovering with minimal business interruption and financial impairment to your company's operations.
Insurance is so important to proper business function that both federal governments and state governments require companies to carry certain types. Thus, being properly insured also helps you protect your company by protecting it from government fines and penalties.
Small Business Insurance Information
In the business world, there are many risks faced by company's every day. The best way that business owners can protect themselves from these perils is by carrying the right insurance coverage.
The The National Association of Insurance Commissioners (NAIC) is the U.S. standard-setting and regulatory support organization. Through the NAIC, state insurance regulators establish standards and best practices, conduct peer review, and coordinate their regulatory oversight.
Commercial insurance is particularly important for small business owners, as they stand to lose a lot more. Should a situation arise - a lawsuit, property damage, theft, etc. - small business owners could end up facing serious financial turmoil.
According to the SBA, having the right insurance plan in place can help you avoid major pitfalls. Your business insurance should offer coverage for all of your assets. It should also include liability and casual coverage.
Types Of Small Business Insurance
Choosing the right type of coverage is absolutely vital. You've got plenty of options. Some you'll need. Some you won't. You should know what's available. Once you look over your options you'll need to conduct a thorough risk assessment. As you evaluate each type of insurance, ask yourself:
- What type of business am I running?
- What are common risks associated with this industry?
- Does this type of insurance cover a situation that could feasibly arise during the normal course of doing business?
- Does my state require me to carry this type of insurance?
- Does my lender or do any of my investors require me to carry this type of policy?
A licensed insurance agent or broker in your state can help you determine what kinds of coverages are prudent for your business types. If you find one licensed to sell multiple policies from multiple companies (independent agents) that person can often help you get the best insurance rates, too. Following is some information on some of the most common small business insurance policies:
|Business Insurance Policy Type||What Is Covered?|
|General Liability Insurance||What is covered under commercial general liability insurance? It steps in to pay claims when you lose a lawsuit with an injured customer, employee, or vendor. The injury could be physical, or it could be a financial loss based on advertising practices.|
|Workers Compensation Insurance||What is covered under workers compensation insurance? This type of insurance protects a business and its owner(s) from claims by employees who suffer a work-related injury, illness or disease. Workers comp typically provides the injured employee with benefits to cover medical expenses, a portion of his/her lost wages, rehabilitation costs if applicable, and permanent partial or permanent total disability.|
|Product Liability Insurance||What is covered under product liability insurance? I pays an injured party's settlement or lawsuit claim arising from a defective product. These are usually caused by design defects, manufacturing defects, or a failure to provide adequate warning or instructions as to how to safely use the product.|
|Commercial Property Insurance||What is covered under business property insurance? General liability policies don't cover damages to your business property. That's what commercial property insurance is for. It protects all of the physical parts of your business: your building, your inventory, and your equipment, giving you the funds you need to replace them in the event of a disaster. If you work from home, you might consider a Home Based Business Insurance policy instead.|
|Business Owners Policy (BOP)||What is covered under a business owners policy (BOP)? This is a policy designed for small, low-risk businesses. It simplifies the basic insurance purchase process by combining general liability policies with business income and commercial property insurance.|
|Commercial Auto Insurance||What is covered under business auto insurance? This type of insurance covers automobiles being used for business purposes. This could include a fleet of business-only vehicles or a single company car. In some cases it might cover your car or your employee's car while they're being used for business. These policies have much higher limits, ensuring you can cover your costs if one of these vehicles gets into an accident.|
|Commercial Umbrella Policies||What is covered under commercial umbrella insurance? This type of policy is a sort of "gap" insurance. It covers your liability in the event that a court verdict or settlement exceeds your general liability policy limits.|
|Liquor Liability Insurance||What is covered under liquor liability insurance? It covers bodily injury or property damage caused by an intoxicated person who was served liquor by the policy holder.|
|Professional Liability (Errors & Omissions)||What is covered under professional liability insurance? This type of business insurance is also known as malpractice oe E&O. It covers the damages that can arise from major mistakes, especially in high-stakes professions where mistakes can be devastating.|
|Surety Bond||What is covered under surety bonds? Bonding is a contract where one party, the SURETY (who assures the obligee that the principal can perform the task), guarantees the performance of certain obligations of a second party, the PRINCIPAL (the contractor or business who will perform the contractual obligation), to a third party, the OBLIGEE (the project owner who is the recipient of an obligation).|
Who Needs General Liability Insurance? - Virtually every business. A single lawsuit or settlement could bankrupt your business five times over. You might also need this policy to win business. Many companies and government agencies won't do business with your company until you can produce proof that you've obtained one of these policies.
Business Insurance Required by Law
If you have any employees most states will require you to carry worker's compensation and unemployment insurance. Some states require you to insure yourself even if you are the only employee working in the business.
Your insurance agent can help you check applicable state laws so you can bring your business into compliance.
Other Types Of Small Business Insurance
There are dozens of other, more specialized forms of small business insurance capable of covering specific problems and risks. These forms of insurance include:
- Business Interruption Insurance
- Commercial Flood Insurance
- Contractor's Insurance
- Cyber Liability
- Data Breach
- Directors and Officers
- Employment Practices Liability
- Environmental or Pollution Liability
- Management Liability
- Sexual Misconduct Liability
Whether you need any or all of these policies will depend on the results of your risk assessment. For example, you probably don't need an environmental or pollution policy if you're running an IT company out of a leased office, but you would need data breach and cyber liability policies to fully protect your business.
Also learn about small business insurance requirements for general liability, business property, commercial auto & workers compensation including small business commercial insurance costs. Call us (855) 767-7828.