Understanding Workers’ Compensation Requirements for Small Employers in Tennessee

If you're a small business owner in East Tennessee, you've likely heard about workers’ compensation insurance—but how do you know when it’s required, what it covers, or where to get it? Whether you're based in Morristown, Dandridge, or Jefferson City, having the right coverage isn’t just smart—it’s often the law.

 

Here’s a clear breakdown of workers’ comp requirements for Tennessee small businesses and what to keep in mind as your company grows.

 

When Is Workers’ Comp Required in Tennessee?

In Tennessee, you must carry workers’ compensation insurance if your business has five or more employees, regardless of whether they are full-time or part-time. However, if you’re in construction or coal mining, the requirement applies if you have just one employee—even if that person is you.

 

Many local contractors, retail shops, and family-run operations find themselves wondering if the rule applies to them. If you're unsure, it's best to talk to a licensed commercial insurance agent in Morristown who knows the state’s laws and how they apply to small employers.

 

What Does Workers’ Compensation Cover?

This type of insurance is designed to protect both the employer and the employee. It helps cover:

- Medical bills and treatment costs for workplace injuries

- Lost wages while the employee is recovering

- Permanent disability benefits if applicable

- Employer liability in case of lawsuits from job-related accidents

 

Even in the safest workplaces, accidents can happen. Workers’ comp ensures that your employees get the care they need while helping you avoid major financial setbacks.

 

Why Even the Smallest Businesses Should Consider It

Even if you’re under the legal threshold, workers’ comp coverage can still be a wise investment. Many independent contractors and small shops around East Tennessee choose to carry a policy voluntarily to:

- Gain peace of mind

- Meet contractual requirements (some clients require proof)

- Attract and retain good workers

 

If your business is growing or hiring its first employee, it’s worth getting a quote and reviewing your options.

 

How to Get Workers’ Comp Insurance in Morristown

As a local commercial insurance agent in Morristown, we help small business owners throughout the area—from Knoxville to Sevierville—find the right workers’ comp policy for their needs. We compare carriers, explain your options, and help you stay compliant with Tennessee state law.

 

Let us know how many employees you have and what kind of work they do, and we’ll match you with a policy that fits your business size and budget.

 

Simple Coverage for Complex Rules

Workers’ comp regulations can feel overwhelming, especially when you're also running payroll, managing staff, and handling day-to-day tasks. That’s why we make it easy. We’ll explain what you need to know, help you file the paperwork, and keep you informed as your business evolves.

 

Frequently Asked Questions

 

What if I hire part-time or seasonal employees?
Tennessee law counts part-time and seasonal workers toward the employee count. If you reach five employees, even temporarily, you may need coverage.

 

Can owners and family members be excluded?
Yes, in many cases business owners, partners, and family members can opt out of coverage. However, exclusions must be filed properly. We’ll help you handle that process.

 

How much does workers’ comp cost for small businesses?
Rates vary based on industry, payroll, and claims history. A low-risk office job costs far less to insure than a roofing crew. We’ll help you shop around and explain how your premium is calculated.

 

Can subcontractors be covered?
Subcontractors often need to carry their own workers’ comp, but sometimes you may be held responsible if they don’t. We can help assess your risk and recommend the right approach.

 

What happens if I don’t carry required coverage?
Failing to carry required workers’ comp insurance in Tennessee can result in penalties, fines, and even legal trouble. It’s best to check your responsibilities now, before you run into problems later.

 

Let’s Talk About Protecting Your Team

If you're a small business owner in Tennessee, don’t leave your workers—or your business—unprotected. Reach out today for a free consultation or quote on workers’ comp insurance. We’ll answer your questions and help you find affordable, compliant coverage that grows with your business.