Workers’ compensation insurance for cleaning and janitorial businesses

If a janitor trips while vacuuming and breaks a bone, or a carpet cleaner falls on a flight of stairs and hurts their back, these injuries could cost thousands of dollars in medical expenses.

Workers’ compensation insurance provides coverage to your cleaning business in three primary areas:

• Employee bodily injury and medical expenses
• Injured employee lawsuits
• Compliance with state laws

Workers’ compensation insurance can cover medical bills if an employee is injured on the job or develops an occupational illness. It also ensures the employee still gets paid part of their wages while recovering from an injury.

Specific examples include:

When an employee is injured on the job, workers’ compensation insurance helps cover:

• Immediate medical costs, such as an ambulance ride and emergency room expenses
• Ongoing medical costs, such as medications and physical rehabilitation
• Disability benefits while the injured worker is unable to work
• Death benefits for fatal incidents

Typically included in a workers’ comp policy, employer’s liability insurance provides protection for business owners if an employee decides to sue over a work-related injury.

For example, one of your window washers complains of vertigo and requests modified duty. If you aren’t able to accommodate the request and they end up falling off a ladder, you could face a lawsuit. In that case, employer’s liability insurance can help cover:

• Attorney’s fees
• Court costs
• Settlements or judgments
• Witness fees

Even if a lawsuit is frivolous, without workers’ comp coverage, you could find yourself paying for a costly legal defense.

The amount you pay for workers’ compensation is a specific rate based on every $100 of your business’s payroll. Insurance carriers determine your premium by the type of work done by your employees (classification rate), your experience modification rate (claims history), and your payroll (per $100).

The formula providers use in underwriting to calculate workers' comp rates is:

Workers’ comp laws are decided at the state level, which means the rules will depend on where your business is based.

For example, cleaning businesses in Florida are not required to purchase workers’ comp coverage unless they have four or more employees. However, cleaning businesses in New York are mandated to purchase a policy if they have even one part-time employee.

While independent contractors, sole proprietors, and partners don’t have to carry workers’ compensation insurance, you can purchase a policy to protect yourself, too. It's a good idea to carry this coverage for financial protection against work injuries, which health insurance might not cover.

In certain states, cleaning businesses must purchase coverage through a monopolistic workers' comp state fund. Those states are:

• North Dakota
• Ohio
• Washington
• Wyoming

If you purchase workers’ comp through a monopolistic state fund, it might not include employer’s liability insurance. However, you can purchase it as stop gap coverage from a private insurance company.

If a pool cleaner suffers a back injury while moving heavy cleaning equipment, or a house cleaner develops breathing problems from years of exposure to toxic cleaning chemicals, it could lead to an insurance claim – and a rise in your premiums.

To help prevent workplace injuries, cleaning service business owners should implement a risk management plan that includes providing safety training and protective equipment for all employees. This can also potentially reduce your insurance premium.

Workers’ compensation insurance protects your employees and to some extent your business, but it doesn’t cover every risk.

Owners of cleaning businesses should also consider purchasing:

General liability insurance: This policy helps pay for expenses related to third-party accidents, like a client slipping on a wet floor after you mop. Your clients may require this type of insurance in their contracts or your landlord might require it to sign a lease.

Commercial auto insurance: Required in almost every state, this policy can pay for property damage and medical bills resulting from an accident involving your company vehicle.

Business owner's policy: A business owner's policy, or BOP, combines general liability insurance with commercial property insurance at a discount. Small, low-risk cleaning businesses are usually eligible. Small businesses can often add inland marine insurance to their BOP to protect cleaning equipment they bring to different job sites.

Commercial umbrella insurance: This policy boosts the coverage limits on your general liability insurance, commercial auto insurance, and employer's liability insurance. Cleaning businesses might need it to fulfill requirements for higher policy limits.

Janitorial bonds: Also known as employee dishonesty bonds, janitorial bonds protect your business against employee theft of client property. Many clients won’t hire a cleaning business that doesn’t have this coverage.

Are you ready to safeguard your pressure washing, septic tank cleaning, or other cleaning business with workers' compensation insurance coverage? Complete Insureon’s easy online application to compare quotes from top U.S. insurance companies.

Once you find the cleaning business insurance policies that fit your needs, you can begin coverage and get a certificate of insurance in less than 24 hours.