For Tri-State business owners, it’s common to send workers out of state for jobs, whether for days, weeks, or even longer. However, many employers don’t realize that if their workers’ compensation insurance policy only covers their home state, they could face uncovered financial obligations when an out-of-state worker gets injured. This oversight can lead to costly claims, legal disputes, and potential penalties. Here’s why this is a significant issue and what you can do to protect your business.
The Problem with Single-State Workers’ Compensation Policies
If you have a workers’ compensation policy that covers only your home state, it may not provide coverage for employees working out of state. This gap in coverage could leave your business financially vulnerable if an employee suffers an injury in another state.
Workers’ compensation laws and benefits vary significantly from state to state. For example:
1. Medical Reimbursement Schedules
• States like New York and New Jersey have different medical fee schedules that determine how much healthcare providers can charge for treating injured workers.
• If an employee is injured in a state with higher reimbursement rates, and your policy doesn’t include that state, your company might have to pay the difference out of pocket.
2. Loss of Wage Benefits
• Wage replacement benefits for injured workers differ by state. For instance, New York calculates wage replacement based on two-thirds of the average weekly wage, capped at $1,145.43 per week (as of 2025).
• New Jersey, on the other hand, has different wage caps and calculations, which could result in higher costs for your business if coverage isn’t in place.
Without proper coverage, you may also be subject to lawsuits or penalties for failing to comply with the workers’ compensation requirements of the state where the injury occurred.
How Out-of-State Work Creates Coverage Gaps
Many businesses mistakenly believe their workers’ compensation policy automatically extends to other states. While some policies include “Other States Coverage,” this coverage typically applies only to incidental, short-term work in other states.
If you regularly send employees out of state for extended periods, the insurer may require specific endorsements to cover those states. Failing to update your policy to include these endorsements can lead to:
• Uncovered medical expenses for the injured employee.
• Fines and penalties for non-compliance with the workers’ compensation laws in the state where the injury occurred.
• Lawsuits from injured employees seeking compensation for medical bills and lost wages.
How to Address the Problem
To ensure your business is fully protected, follow these steps:
1. Review Your Current Workers’ Compensation Policy
• Check if your policy includes “Other States Coverage” or if it is restricted to your home state.
• Verify whether the states your employees work in are listed in your policy.
2. Add Specific Endorsements
• Work with an insurance expert to add endorsements for the states where your employees frequently work. This ensures compliance with those states’ workers’ compensation laws.
3. Understand the Laws of Each State
• Familiarize yourself with the workers’ compensation requirements of states like New York, New Jersey, and Connecticut.
• Pay attention to differences in medical fee schedules, wage replacement benefits, and other regulatory nuances.
4. Ensure Multi-State Coverage
• If your business frequently operates in multiple states, consider a multi-state workers’ compensation policy. This type of policy is specifically designed to provide seamless coverage for employees working across state lines.
5. Work with a Workers’ Compensation Specialist
• Partner with a specialist who understands the complexities of workers’ compensation insurance. They can help you assess your risks, tailor your policy, and ensure you remain compliant with all applicable laws.
Why BGES Group is the Right Choice for Tri-State Businesses
At BGES Group, we understand that managing workers’ compensation insurance for multi-state operations can be overwhelming. That’s why we specialize in helping New York, New Jersey, and Connecticut businesses secure comprehensive coverage that protects them from unnecessary risks.
When you work with BGES Group, you’ll benefit from:
• Expert Guidance: Our team has decades of experience in workers’ compensation insurance, ensuring your policy is tailored to your business needs.
• Compliance Assurance: We stay up-to-date on state-specific workers’ compensation laws and ensure your policy complies with all regulations.
• Cost-Effective Solutions: We’ll help you find competitive rates without compromising on coverage quality.
• Personalized Service: As a boutique agency, we offer hands-on support to address your unique concerns and challenges.
Don’t Risk Your Business’s Future
If you send employees out of state without proper workers’ compensation coverage, you’re leaving your business exposed to significant financial and legal risks. Taking the steps outlined above will protect your employees, keep you compliant with state laws, and shield your company from unexpected costs.
At BGES Group, we’re here to help you navigate the complexities of workers’ compensation insurance and find the best solutions for your business. Whether you’re a contractor, manufacturer, or operate in any other industry, our team has the expertise to ensure your business is fully protected.
Contact BGES Group Today
Don’t leave your business exposed to uncovered claims. Contact Gary Wallach at BGES Group for a free consultation.
• Phone: 914-806-5853
• Email: bgesgroup@gmail.com
• Website: www.bgesgroup.com
We’re the workers’ compensation insurance specialists you can trust to protect your business, employees, and bottom line.