If Any Workers' Compensation Insurance or Ghost Insurance Policies
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Ghost workers compensation insurance for contractors with no employees
You have no employees. You know you don’t need workers compensation. Then a general contractor calls and says you need a certificate of insurance showing workers comp coverage before they’ll let you on the job site.
This happens dozens of times a day. It’s not a mistake, and it’s not negotiable. The solution is a ghost policy, also called an If Any policy. It costs about $1,000 per year, it satisfies the contractual requirement, and it keeps you working.
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Why the General Contractor is asking for this
When a general contractor’s workers compensation carrier does its annual audit, it asks for certificates of insurance from every subcontractor the GC paid that year. If the GC can’t produce those certificates, the money they paid those subs gets reclassified as wages. That amount gets added to the GC’s payroll and they get billed for the additional premium.
The math is straightforward. If they paid you $100,000 and you can’t produce your COI, that $100,000 becomes payroll. Their premium goes up significantly. To avoid that, they require every sub to carry workers compensation before work starts. No certificate, no job.
What a Ghost Policy actually is
A ghost policy, or If Any policy, is a workers compensation policy that covers you as the only person on it. There are no employees on the policy because you have none. The policy exists to satisfy the contractual requirement and give the GC the certificate they need. That’s its entire purpose.
It does not provide you with personal injury benefits the way a standard workers compensation policy would for an employee. What it does is keep you eligible for contracts with general contractors and larger clients who require proof of coverage.
PRO TIP
The ghost policy covers you. It does not cover your subcontractors. If you paid a sub during the year and can’t produce their certificate at audit, that money becomes your payroll, and you get a bill. Get certificates from every sub before they start work. After the fact is usually too late.
How much does a ghost or if any workers’ compensation cost?
About $1,000 per year. Every state is different and every situation is slightly different, but $1,000 is a reliable ballpark for bidding purposes.
Pass that cost to the client. If a job requires you to carry this policy, that cost is a direct project expense. Build it into your bid.
There’s also potential upside at audit time. If you can show you had no employees during the policy year and you supply certificates from any subcontractors you used, you may qualify for a partial refund on the premium you paid.
Who needs a Ghost Policy
Any contractor who works as a solo operator or sole proprietor and regularly bids on jobs that require proof of workers compensation. If you have ever lost a contract because you couldn’t provide that certificate, this policy solves the problem.
Farmer Brown Insurance places ghost policies and If Any policies for contractors in all 50 states. Texas is the only state where workers compensation is optional for private employers. Every other state requires it for businesses with employees, which is why the certificate requirement is standard across the industry.
- Our team members are professional and knowledgeable and able to help you choose the perfect policy for your needs.
- Having a business that needs a specialized Ghost Workers’ Compensation Insurance to cover your unique needs knowledgeable agents at FarmerBrown.com.
- Flexible agents to work on your time schedule.
- We provide easy online payment options.
- We are licensed in all 50 States to offer Workers’ Compensation Insurance.
- Same day service in most cases.
- “A” Rated insurance companies that pay claims quickly.
We have been placing workers compensation policies for contractors since 1996. Same-day coverage in most cases. A-rated carriers. We are licensed in all 50 states.
Our agents walk through your situation before you buy anything, so you get exactly what you need and nothing you don’t.
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We are located in 21750 Hardy Oak Blvd Ste. San Antonio, TX, 78258
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