I am in North Carolina. My company is incorporated and I am the sole owner/president. I found out today that the group health insurance(Blue Cross/Blue Shield) that my wife has that covers her, me and the kids does not cover me in case of a work related injury because I am “voluntarily” excluded from my company’s worker’s comp. insurance. The reason I exclude myself from the policy(I have 3 employees who are covered) is because in NC worker’s comp is based on payroll and they can hit me at rate of approx. $17 per $100 up to approx. $60,000(I’d have to look up the exact numbers). Since I’m likely to make near that $60,000 figure this year I would rather not pay approx. $10,200 to be covered by worker’s comp but I’m wondering if I have any other options. I have a quote for 5 years worth of disability that is a lot cheaper than the workers comp would be but that would only replace most of my monthly income for 5 years, it would not pay my medical bills.
Bottom line question, what are y’all doing so your not just taking a chance every day you go to work?
Replies
dog.. i'm incorporated..
and i cover myself under our comp policy
my rate as a supervisor / carpenter is 5.65 / 100
i'm also covered under my wife's BC/ BS which we pay extra for to extend the coverage to me
so, i 'm covered for work related and everything else
Don't bet on it as I have been screwed by a clause on page 57 of a contract I never saw or signed on my wife's insurance.
Then in another incident we thought we had insurance but the owner of the company had not been paying the premiums into the ins. co. but was collecting from his employees even the employee benifits guy didn't know until I gave him the insurance companies # and told him to call and ask.
The next week the feds were in the office gathering all the records and hauling the owner off in cuffs and this was a fairly large company he was also over billing medicare to the tune of millions.
ANDYSZ2I MAY DISAGREE WITH WHAT YOUR SAYING BUT I WILL DEFEND TO THE DEATH YOUR RIGHT TO SAY IT.
Remodeler/Punchout
dog.. i'm incorporated
We have a TIVO and my wife just finished watching American Idol. When I read that all I could think of was a white guy from Rhode Island doing his best Randy Jackson impression.
Almost fell out of my chair.
Sorry.
Almost forgot. One of your Guard units from RI just landed six pages in the January-February 2006 Infantry Journal.
If I remember I'll scan it and send it to you tomorrow.
infantry journal ?... must be that 10th mountain unit..
my old unit was the 103d FA Gp.. they retrained & went over as MP's ( ????)Mike Smith Rhode Island : Design / Build / Repair / Restore
Dog,
Thats an interesting question since I was just discussing it with my agent. I am also voluntarily excluded and he assured me that I am covered for work related injuries under my Wife's Blue Cross at her work for the county Govt. I guess I need to look into it further. My comp isnt as bad due to our occupation but it's still about 5% right now for my employees. Did you actually find this in writing in her policy, or just word of mouth ?
Bill Koustenis
Advanced Automotive Machine
Waldorf Md
I spoke with the agent and she is e-mailing me the clause from the contract.
I would rather not pay approx. $10,200 to be covered by worker's comp but I'm wondering if I have any other options.
For that kind of scratch on the line, go see your lawyer. For example, have the corporation's board (you, you and you, of course) adopt a formal resolution excluding the president from eligibility for WC coverage under the company's WC policy. Bingo, it's no longer a voluntary exclusion. The fire you are playing with there is hot enough that you need a local guy to tell you if that would work in your state, and with your wife's particular policy. On the one side you got the WC law and on the other a powerful insurance company. Thread the needle right and maybe you can save the bucks.
Like I said, for that kind of $$$, worth it to pay to find out.
"Let's get crack-a-lackin" --- Adam Carolla
Yes he should see his lawyer but that simple scam isn't likely to work. In a closely held corp you don't get to play the same games as GE and Exxon. Matter of fact you don't get to play almost any games at all that you couldn't play without the corp.
You can do anything you want, but that doesn't mean it's going to hold water when you need it to...
DG/Builder
>>"Yes he should see his lawyer but that simple scam isn't likely to work.
Ahem. With all due respect, the scam may be a health insurer that accepts premiums, won't pay for health care under certain circumstances and wants to force the OP to buy yet more insurance.
I just used a simple corporate formality as an example of something easy right off the top of my head that might work. Somebody on the ground where he is might come up with something that works.
The insurance company wants to play games. No reason not to pick up the bat and play along. Not a scam in my book. Part of the modern business world.
>>"You can do anything you want, but that doesn't mean it's going to hold water when you need it to...
You are right. That's why I described it as threading the needle. A good lawyer will tell him if it's routine sewing or not do-able.
Does you wife work for an insurance co. or something? Lots of insurance stocks in your portfolio? ;-)
"Let's get crack-a-lackin" --- Adam Carolla
That's funny - my wife works for the pharmaceutical companies and I can't complain one iota about the price of prescription drugs without getting chewed out.$95 for 25ml of whatever...JT
Ahem. With all due respect, the scam may be a health insurer that accepts premiums, won't pay for health care under certain circumstances and wants to force the OP to buy yet more insurance.
No. The OP already stated the insurer is BC/BS. This is a very simple common sense situation. BC/BS is insuring the wife and her family for normal health risks. Like if the husband were an accountant or draftsman. They will not cover a family member for work-related injuries in a high risk (health-wise) occupation such as construction or alligator rassling :) Common sense will tell you that the higher risk needs to be compensated by additional premiums. My health insurance co. will not cover certain risks such as hang gliding and extreme sports. My home owners insurance wants a huge premium if I have kids and a trampoline in the back yard. All pretty common sense.
Does you wife work for an insurance co. or something? Lots of insurance stocks in your portfolio?
No and no. She is self-employed and on my policy. It is not a BC/BS policy so I have no axe to grind with BC/BS either way.
DG/Builder
>>"They will not cover a family member for work-related injuries in a high risk (health-wise) occupation such as construction or alligator rassling :)
What you're saying there has a lot of merit, but to put a finer point to it, his health insurer won't cover any work related health needs if he voluntarily opts out of comp. Accountant or sword swallower. ;-)
If you have comp, then comp is primary and health insurer has to pick up anything it covers that comp doesn't (there is still risk there, but it is less). Agreed it would be additional risk for health insurer (if you opt out of comp and they still have to cover you), no matter what you do for a living, but what you do isn't the determining factor -- question is have you voluntarily opted out of comp.
On the other side of it, the $10k comp rate is based mostly on the disability aspect of comp (rates based on income). He has (or can get) a separate disability policy, greatly reducing the risk to the comp carrier, but can't get an equivalent discount out of comp for that reduced risk.
I agree it's very likely not the same ins. co. getting the double dip, but the insurance industry rules let "them" have their cake and eat it too.
Still don't see it as a "scam" for the employee to try to avoid that whipsaw. That's all.
"Let's get crack-a-lackin" --- Adam Carolla
Edited 4/18/2006 11:19 am ET by philarenewal
Edited 4/18/2006 11:28 am ET by philarenewal
Edited 4/18/2006 11:30 am ET by philarenewal
I have the exact same situation as you... medical insurance that will not pay on a work-related injury. I voluntarily pay the premiums for state WC insurance, between $1.75-$2.75 per hour depending on what I'm doing. For that I get the peace of mind of knowing that I'm covered. No way I'm going to climb ladders, play with table saws, or do any of the other stuff I do all day without coverage. Since it's WC coverage it includes a disability component that medical insurance does not.
What's the chance that you can buy medical insurance that does not exclude work related injuries? Talk to your insurance broker and see. It might be possible to get something cheaper than WC.
I have the same business set up as you do and I am covered by comp. In my state I have to be covered as it is mandatory unless I am the only employee and the owner. One thing you might consider is to try and reduce your amount of income.
My corporation rents a building from my wife and I. I take a salary at a resonable level and then rent the building to allow myself more income with less deductions and overhead expenses. You could probably do the same with vehicals etc. Legal, cuts down on the payroll overhead, straight deduction as an expense for the business and you still have some flexibility as far as setting the rent. DanT
According to my tax person, the IRS has certain minimums they want you to pay yourself, based on the industry you're in. They look at what employees make across the board in the industry, and unless you pay yourself that much apparently you're a tax evader. I assume that any WC provider could apply the same test. So, I pay myself market rate for all hours worked and do the same vehicle and office rental deal you're talking about. I could certainly save money by paying myself $2/HR. for the first 10 hours of each week, and then take rental and dividend income for the rest, but I have a feeling that wouldn't fly on audit. I'm sure you know this already.
My accountant, who worked for the IRS for a number of years, has said that 18k a year is the threshhold I need to pay myself. And I do. I pay myself 1500 a month in rent for my building. Money that after expenses etc. I pay tax income tax on. Not a scam, not done without research and have done it for 6 years with no issues. DanT
My daughter and I used to be insured under my wife's BCBS group policy. My daughter and I now each have seperate BCBS policies. Since my wife's employer just picked up part of the family premium, it is considerably cheaper.
A good BCBS rep might figure something out for you that will cover you on the job and be cheaper to boot.
Ask your agent about accident policies as an alternative to Workmans Comp.
Dogfish,
When I went on my own, I searched out a policy that would cover me, that I could add my family to, and would cover any injuries that happened at work. My wife was covered BC/BS by her employer.
The plan was she, and any kids would go on my policy after we had them and she stopped working.
Fast forward a little. My daughter is born three months premature and is very sick. Months in the hospital. Guess what! My insurer will not add them because of " Pre-existing" conditions. My wife can work two days a week but all of her pay would go towards covering her existing BC/BS. Problem is? It won't cover me if I get hurt at work.
So, for about a year, she basically worked for free so her and my daughter had health coverage, and I continued to pay for my policy.
Same year: A good friend of mine was an employee of someone else. His boss didn't offer any health plan so he went out and got his own. Wife was a stay at home mom.
Later that year, he finds out his boss has been taking taxes out but not paying the IRS. He quites and goes on his own.
One day, he feeds his hand into the table saw. That's when he found out that his policy did NOT cover work related injuries of any kind and for any reason. He was told he could have changed that for a larger premium, but the thought never crossed his mind to let them know.
I did in fact pay W/C on myself for two years and that's a whole other discussion. It was split. Part management/Clerical and part as a general carpenter. Worked out to about $8/$100
The only people who can tell you what works best are the ones who decide what they will and won't cover.
I suggest you talk to your own agent as well as maybe one or two others and see who offers what.
As for W/C? I see a time in the near future where everybody, LLC owner, S-Corp Owner and Sole Proprietor will all have to be covered. When you figure in all of the factors such as disability and such, it isn't as bad as it sounds. Dollar for Dollar it didn't end up cosing me that much.
Remember, if your covered by your W/C then your wife's BC/BS should cover your non work related health issues.
Too many guys "Think" they are covered by their wife's policy. They may be surprised.