Sub-contracting insurance?

Question

My husband has to get workers comp to be able to sub-cont for a local business. He has to have himself and his employees covered. He does not have to have general liability. I've called around to get a few quate but no replies yet. What should we expect the cost to be? Does he qualify to opt out and should he? We just don't want to spend to much money trying to make money. He is just starting out on his own and later when the funds are available he plans to also purchase other plans, such as his own genral liability. Any advice would be appriciated. I'm really seeking the opionion of a insurance agent. Thanks

vinyl siding and window instalation

10 years experience in this field working hourly

2 men, $8 and $10 hourly

40 hours a week

his pay depends on work available

Spartanburg, SC 29301

Answer 1

Figuring your payroll to be about $37,000 per year, the WC premium will probably be around $10,000 if he chooses to exclude himself from coverage. This is based on GA rates, but I would assume that it will be pretty close in SC for carpentry. WC is very expensive!

Answer 2

OK, well, you're not going to get responses for workers comp only, or not many.  From an agent's point of view, he's buying only what he needs, probably for the shortest time possible, but it's still going to take a LOT of work.  

It would be like him driving 5 hours to replace a $100 window.  Not worth the time.

So he's going to have to ask the agent that writes ANY of his business, for a quote.  The RATE on this is probably going to be about 15% of payroll.  You're talking about $36,000 of payroll, more if it's a corporation.   It's going to run you about $5,000.   No matter how low you drop that payrolll, it's going to cost MINIMUM PREMIUM, which will be about $2500 for that class of business.  Up front, no payments.  Just so you know where the agent is coming from, they'll be making about $125 off of that policy.  Postage will be about $4 each way, if you don't make any changes, and it will likely take about an hour of processing.  Plus the postage for your certificates of insurance, and cost to issue all those.  

Keep in mind, any contractor who wants him to have WC, is ALSO going to want him to have GL coverage.  

Also, he can't "opt out" of benefits to his employees.  That means, even though he doesn't have comp in place right now, if one of these guys gets hurt, he STILL has to pay their lost wages and medical bills, until they are able to work again.  Period.  NO exceptions.  Even if he 1099's them.  Even if they're illegal.  Even if they sign a waiver.  Period.

My advice?  Talk to your homeowners/auto agent about getting a contractors policy - to get the tools covered, and stock if you have any, and the truck properly insured, etc.  Not to mention the GL and WC.