Shuman Roy is an entrepreneur, business owner, and musician. He started RoysNoys, LLC in 2013 as a music production and education service company. He also offers small business consulting and advisory services to help businesses get from start-up mode to turn-key operations. Shuman earned his M.B.A from the Stern School of Business in 2001 and has an undergraduate degree from Manhattan College in ...

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Joel Ohman is the CEO of a private equity-backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Joel...

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Reviewed by Joel Ohman
Founder, CFP®

UPDATED: Dec 1, 2020

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Most states require some form of workers compensation insurance and carry different laws regarding benefits.

Work Comp coverage offers benefits to employees of companies and must be purchased by employers.

A workers compensation policy has three parts; state benefits, referred to simply as work comp, employer’s liability, and “other states” benefits (discussed here).

Section 3C: Other States

Coverage part 3 of the workers compensation insurance policy details the “other states” provision possibly included in a workers compensation insurance policy.

This section of the policy is straightforward and resembles personal auto insurance, whereby the policy will automatically adapt to the limits and provisions of any state where your employees are working, regardless of what state the policy was originally designed for.

Example: You own a construction company in Illinois, where you originally purchased your workers compensation policy, and bid on and won a job in Missouri, requiring your employees to work across state lines.

In the event one of your employees suffers bodily injury resulting from a work-related accident, your Illinois policy would automatically adjust to the necessary limits and provisions of Missouri state law.

However, the insured employer would not have to pay a higher premium above and beyond that dictated on the original policy.

As mentioned earlier, each state has different laws, so be sure to contact your employer or state department of insurance to determine what benefits you may be eligible for as a result of a work-related accident.