The state of Colorado requires most business owners to provide workers’ compensation coverage to their employees.
This gives injured employees the funds they need to cover medical expenses for work-related accidents, and compensates them for disability, lost wages, and more.
Keep reading to learn more about Colorado workers’ compensation laws and how to get affordable insurance coverage.
Any Colorado business with one or more employees, whether they work full-time or part-time, is required to carry workers’ comp.
The 1915 Colorado Workers’ Compensation Act established this as a requirement for most businesses in the state.
But there are some businesses and workers who may qualify for exemptions, including:
Workers’ comp in Colorado works similarly to the way it does in other states. When an employee gets injured at work, they can file a claim to receive compensation for medical care, lost wages, and other related expenses. This is overseen by the Colorado Division of Workers’ Compensation.
Workers’ comp covers a range of work-related injuries and illnesses, such as:
In addition to light injuries that simply require one or two doctor’s visits, comp also covers more serious cases that may result in disability or death. Coverage can provide financial compensation for things like:
Depending on the severity of their illness or injury, injured workers may be able to receive certain benefits through workers’ comp. This includes money for lost wages, lasting disability, and death.
Once an employee recovers as much as they can (this is known as maximum medical improvement or MMI), their medical provider will assign them an impairment rating, or a percentage that shows how much the injury has permanently affected them. Based on this rating, the insurance company decides whether the worker will receive disability benefits in the future and, if so, how much.
For example, a construction worker who injures his back and never recovers his full range of movement, making it hard for him to continue working in construction, may be able to receive disability benefits for years.
How much an employee receives and for how long also depends on whether their disability is temporary or permanent, and whether it is partial or total. Here’s the breakdown for disability benefit payments:
Workers’ comp tends to be expensive because it’s charged upfront for the entire year, based on a business’s estimated payroll. To make matters worse, insurance carriers will sometimes charge heavy premiums, and if your estimated and actual payroll don’t match up at the end of the year, you’ll be charged high audit fees to make up the difference.
At Hourly, we solve those problems to improve cash flow and make workers’ comp more affordable. Instead of upfront payments, we offer pay-as-you-go pricing based on your actual payroll, and we calculate your payroll numbers in real time for 99% accuracy, eliminating audit fees and other unnecessary expenses.
Workers’ comp payments in Colorado vary based on the extent of an employee’s injuries. If an employee has to miss work to recover, they’ll typically receive two-thirds of their average weekly wage up to the state’s max for as many weeks as they’re absent.
In 2023, the maximum rate for Colorado workers’ comp is $1,293.25 per week, if the employee has an average weekly wage of $1,939.88.
That’s two-thirds of a worker’s average weekly wage up to the state max.
The maximum combined cap for total temporary disability and permanent partial disability is $238,596.43.
The maximum death benefit paid to dependents is $1,293.25 per week, plus $13,153.53 for funeral and burial expenses.
Benefits usually end when an employee is able to return to their job and make the same amount they were making before the injury. Of course, that doesn’t always happen. If a worker is permanently disabled, they may be able to receive benefits for the rest of their life.
According to the Colorado Department of Labor and Employment (CDLE), an employer must file a First Report of Injury (FROI) with the Division of Workers’ Compensation (DWOC) within 10 days of the date of injury, if an employee’s injury or illness causes one or more of the following:
Employers can file this form online via the CDLE website.
To file a claim for benefits, an employee must:
As a small business, managing workers’ comp can be stressful. Hourly is here to simplify the coverage process and help you protect your employees without breaking the bank.
With pay-as-you-go pricing based on actual, real-time payroll figures, we help businesses like yours boost their cash flow and say buh-bye to those nasty audit surprises.
Talk to your insurance agent today to see how you can get started.
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