Workers Comp
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Workers' comp in Tennessee | Pie Insurance

Most employers in Tennessee are required to carry workers’ compensation insurance. Learn if your business qualifies and how it can protect your employees.
Workers' comp in Tennessee | Pie Insurance

Tennessee workers’ comp 101

Tennessee workers’ compensation exists to protect you, your small business, and your employees from any on-the-job injury or illness.

If you’re a Tennessee small business owner, you likely need to carry some form of workers’ compensation insurance. According to the Department of Labor & Workforce Development, Tennessee state law requires specific (but not all) employers to provide workers’ compensation coverage benefits for two reasons.

    1. Under the Tennessee Workers’ Compensation Law, if any of your workers suffer an injury or illness while on the job, they’ll be better able to receive the proper medical treatment. They’ll also receive wage replacement benefits that they’re entitled to as an injured employee.
    2. The coverage provides a level of fairness across businesses in Tennessee. It’s not fair to put responsible business owners who purchase workers’ comp coverage in competition with those who don’t or aren’t compliant with the state law.

Read on to learn what’s required of you as a Tennessee employer and how to protect your business and employees from any accidents that may occur on the job.

Who’s required to carry workers’ compensation insurance?


If you’re an employer in construction or trades (including construction service providers) and have one or more employees, you’re required to carry insurance unless those employees are specifically exempted.

As an owner of a construction business, you’re required to carry workers’ compensation coverage for yourself, or you must be listed on the Exemption Registry, as of March 1, 2011.

Coal Mining

If you have one or more employees in the coal mining industry, you’re required to have coverage. 

Businesses with 5 or more employees

Aside from the industries mentioned above, every other Tennessee business with five or more employees is required to purchase workers’ compensation insurance coverage.

This can be done by either purchasing a policy from an insurance carrier or becoming a self-insured employer with the Department of Commerce and Insurance.

Family members, part-time employees, and corporate officers aren’t excluded from workers’ compensation coverage. They’re included when determining how many employees work for a business. 


Subcontractors must provide workers’ comp coverage to their employees.  

Subcontractors can work with the general contractor to be covered by the general contractor’s workers’ compensation coverage. 

Sole proprietors and partners

Sole proprietors and partners aren’t typically covered by their workers’ comp policy when it’s created unless the contractor is considered a construction services provider. This means they’re a person or entity engaged in the construction industry.

Sole proprietors and partners can opt-in for coverage for their workers’ compensation policy by filing an Election of Sole Proprietor or Partner to Come Within the Provisions of the Tennessee Workers’ Compensation Law (Form I-4).

Your responsibility as a Tennessee employer

In the event of a workers’ compensation claim, you have rights and responsibilities as an employer:

    • Obtain and carry workers’ compensation insurance if your company is required to by Tennessee state law.
    • Accept all reports from your employees of injuries and provide them with options for physicians and medical treatment options.
    • Report injuries to the insurance carrier that wrote your policy within 24 hours.

How to obtain workers’ compensation insurance coverage as a Tennessee employer

There are many ways to go about obtaining workers’ compensation coverage as a Tennessee employer. These methods include:

Insurance agent

You can obtain insurance by working with an insurance agent. The agent can write a workers’ comp policy from one of the 400+ insurance companies licensed by the Department of Commerce and Insurance to sell insurance in the state of Tennessee. Need a workers’ comp quote? Get one in minutes and save up to 30%. It’s as easy as pie. 

Assigned Risk Plan

If you’ve been denied a policy by two or more non-affiliated insurance companies that are licensed to write insurance policies in Tennessee, you can obtain workers’ compensation coverage from the Assigned Risk Plan. There are 10 companies that write policies in the Assigned Risk Plan.

If you’ve been denied a policy and currently have another form of commercial insurance already (such as commercial automobile or general liability), you can ask your insurance agent if they can place you with an insurance company they represent that participates in the Assigned Risk Plan. 

Group insurance

Group self-insurance is another way to obtain workers’ compensation coverage. A group self-insurance pool or trust must be approved by the Department of Commerce and Insurance

Individual insurance

Individual self-insurance must also be approved by the Department of Commerce and Insurance.

What do Tennessee small business owners need to know about workers’ compensation?

There are several ways in which you can be exempt from obtaining workers’ compensation insurance. You may be exempt if:

    • You’re a sole proprietor and own 100% of the assets of the business. 
    • You’re an officer of a corporation.
    • You’re a member of an LLC with at least 20% ownership interest.
    • You’re a partner in a partnership with at least 20% ownership interest.
    • You and members of the same family hold at least 95% ownership of the business.
    • You can only apply for exemption as an individual business owner in the construction services field.

3 essential facts about workers’ comp insurance in Tennessee

    1. It’s illegal for an employer or business owner to require an employee to pay any amount of the business’ workers’ compensation premiums.
    2. Even if you’re not legally required to obtain workers’ compensation insurance, you can opt to be covered.
      1. You can do this by filing an I-8 form, the Exempt Employers Notice of Acceptance of the Workers’ Compensation Act of Tennessee.
      2. You’ll need to file the Exempt Employers Withdrawal of Notice of Acceptance (I-9) form if you decide you no longer want workers’ compensation insurance.
      3. You’ll be subject to all workers’ compensation requirements until you file the appropriate paperwork to let the Bureau know you no longer want coverage. 
    3. Injuries and illnesses that need to be reported as a workers’ compensation claim include the following:
      1. Death of an employee.
      2. An injury or illness requiring the employee to receive medical treatment outside the employer’s premises.
      3. An injury or illness that causes the employee’s absence from work, or their retention of a permanent impairment.

Curious about Tennessee workers’ comp rates?

Remember, every situation is different. Tennessee workers’ compensation laws are subject to change, so be sure to do your research and speak with a trusted advisor.

Please note that this content is intended for educational purposes only. As laws change regularly, refer to your state legislation or an advisor for specific legal counsel. If you’re a small business owner, learn more about the basics of workers’ comp or check your current rate in 3 minutes.