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Kentucky workers' compensation insurance: Your guide to requirements and getting a policy
If you’re a Kentucky employer looking to protect both your business and your team, you’re in the right place. At Beyond, we provide the essential information you need to understand how workers’ compensation works and how to stay compliant.
Workers’ compensation insurance is designed to provide medical treatment and supplemental wages to Kentucky employees who are injured or become ill on the job. But it also acts as a critical safety net for employers, protecting them from potential lawsuits related to workplace injuries.
Now that we understand the purpose of a workers’ comp policy, let’s explore which businesses in Kentucky are required to carry coverage.
All employers in Kentucky with one (1) or more employees are required to maintain workers’ compensation coverage—this includes public and private sector businesses. There are no exemptions for family members, part-time, or temporary workers. Additionally, any employer performing work in Kentucky—even on a temporary basis—must carry workers’ comp coverage.
Every employer must also display a Kentucky Workers’ Compensation posting notice in a visible area at their primary place of business.
Yes, a few business categories are exempt from coverage requirements, including:
Agricultural employers
Employers with fewer than two full-time domestic workers in a private home
Employers whose workers are covered by federal programs (e.g., railroad or maritime)
Religious organizations
Homeowners employing maintenance or repair workers for no more than 20 consecutive workdays
Independent contractors — Kentucky’s Supreme Court has issued a guide to help determine if a worker qualifies as an independent contractor or an employee
Even if exempt, employers may voluntarily opt into workers’ comp coverage. Similarly, employees may choose to waive their right to workers’ comp benefits by submitting a completed Form 4 Waiver to the Kentucky Department of Workers’ Claims.
Workers’ compensation in Kentucky is designed to assist employees who suffer work-related injuries or illnesses. Common benefits include:
Medical Coverage — Includes doctor visits, surgeries, hospital care, nursing services, medical supplies, and related equipment
Temporary Total Disability (TTD) — Income benefits for employees who are temporarily unable to work
Permanent Partial Disability (PPD) — Weekly compensation based on the extent of partial permanent disability
Permanent Total Disability (PTD) — Long-term compensation based on the worker’s average pre-injury wage
Rehabilitation Services — Includes physical and vocational rehab for workers unable to return to their previous job
Death and Burial Benefits — Provides death benefits and funeral expense coverage to a deceased employee’s family or dependents
Kentucky also offers a return-to-work program and is one of the few states that allows cases to be reopened after settlement.
Employers can purchase a policy from any licensed insurance provider authorized to sell workers’ comp in the state. Businesses considered high-risk may be assigned coverage through Kentucky’s residual market. Larger employers may choose to self-insure, provided they meet specific financial criteria and file Form SI-02 (Employer’s Application to Self-Insure).
Failure to maintain coverage comes with serious consequences:
Fines ranging from $100 to $1,000 per employee per day without coverage
Full reimbursement to the Uninsured Employers’ Fund (UEF) for any benefits paid to injured workers
Exposure to lawsuits for pain, suffering, and punitive damages
Criminal penalties, including fines and potential jail time
Employees must report injuries to a supervisor, HR representative, or designated contact as soon as possible. Once notified, employers must report the incident to their insurance carrier within three (3) days using the First Report of Injury or Illness form.
Deadlines for filing claims:
2 years from the date of injury
3 years from the diagnosis of an occupational disease or from the appearance of symptoms, whichever comes first
Employees should seek emergency treatment if needed. For ongoing care, they can refer to the state’s list of approved physicians and providers.
For more information, contact the Kentucky Department of Workers’ Claims at (502) 564-5550 or visit their website. Helpful resources include:
Having workers’ compensation coverage isn’t just a legal requirement—it’s a smart investment. It protects your business from costly penalties and lawsuits while offering peace of mind and security to your team.
Need help finding the right policy or getting started? Beyond is here to guide you through the process.
