Illinois Contractors who Utilize Subcontractors

Did you know that if you have Workers’ Compensation in Illinois and you use subcontractors in your business you may be liable for uninsured subcontractors? Without VALID Workers’ Compensation certificates of insurance for your subcontractors you may be charged an additional premium and could be liable for injury and or death of your subcontractors and/or their employees.

 

Your subcontractors provide you with a certificate of insurance as evidence of Workers’ Compensation coverage. The certificate of insurance lists the Workers’ Compensation carrier, policy number and policy term. The subcontractor working for you is shown as the “Insured”, and your company as “Certificate Holder”. However, a certificate of insurance does not guarantee that coverage is valid and in force when the subcontractor is working for you.

 

Why do you need to know if a Certificate of Insurance is valid?

 

• You need to know this because if one of your subcontractor’s policies cancels you may be charged additional premium during the period the subcontractor was uninsured.

 

• As the primary contractor you may not always be notified of a subcontractor’s policy cancellation, which would then make you liable for providing Workers’ Compensation insurance for these uninsured subcontractors and premiums will be assessed to you.

 

• Just because you are a certificate holder does not guarantee that workers compensation coverage is valid for the subcontractor or that you will be notified of cancellation.

 

The Illinois Workers Compensation Commission provides an Employer Insurance Coverage Search on their website. The Employer Insurance Coverage Search web page provides information for 1) employers that have bought a workers compensation insurance policy (based on the National Council on Compensation Insurance (NCCI) database); and 2) employers (parent companies and their subsidiaries) that have obtained IWCC approval to self-insure.

 

The database does not include Illinois employers that are in self-insurance pools, which are regulated by the Illinois Division of Insurance.

 

         

 Go to: http://www.iwcc.il.gov/coverage.htm

• Click search for an employer’s insurance coverage
• Enter requested information for employer’s coverage in question
• When asked for Coverage/Injury/Illness Date, input date of your coverage inquiry

 

 

 

If you find coverage was cancelled or not in effect, please follow up with your subcontractor immediately as you may be liable for the uninsured exposure.

 

Remember, you as the primary contractor are liable for providing workers compensation insurance for uninsured subcontractors.