What Happens If My Business Doesn't Have Workers’ Compensation Insurance?

Workers’ compensation insurance is designed to help protect employees who suffer work-related injuries or illnesses while also helping employers manage the financial risks associated with workplace accidents. Depending on where your business operates and how many employees you have, carrying workers’ compensation may also be required by law. Operating without required coverage can expose a business to significant financial and legal consequences.

What Does Workers’ Compensation Insurance Cover?

Workers’ compensation generally provides benefits to employees who experience qualifying work-related injuries or illnesses. Instead of a business having to absorb these expenses on its own, workers’ compensation insurance may help cover:



• Medical treatment
• A portion of lost wages
• Disability benefits
• Rehabilitation expenses
• Death benefits for eligible dependents

Is Workers’ Compensation Insurance Required?

Workers’ compensation requirements vary by state, so business owners should understand the rules where they employ workers. In Connecticut, employers generally must meet the state's workers’ compensation requirements by carrying appropriate insurance or qualifying through an approved method of self-insurance, subject to applicable exceptions and rules. 

What Happens If an Employee Gets Hurt and You Don’t Have Coverage?

If an employee suffers a work-related injury while your business lacks required workers’ compensation coverage, the financial consequences can extend beyond the employee's immediate medical bills. Under Connecticut law, failure to comply with the insurance requirements can allow an injured employee to bring an action against the employer for damages in certain circumstances. 

Can Your Business Be Fined for Not Having Workers’ Compensation?

Yes. Connecticut law provides substantial penalties for employers that fail to comply with workers’ compensation insurance requirements. An employer found noncompliant can face a civil penalty ranging from a statutory minimum up to $50,000, with an additional $100 per day for continued noncompliance after a finding, subject to another $50,000 aggregate cap.

Can Operating Without Workers’ Comp Lead to Criminal Consequences?

In serious cases, yes. Connecticut law provides that knowingly and willfully failing to comply with workers’ compensation insurance requirements can constitute a Class D felony for specified business owners, partners, LLC principals, or corporate officers. Connecticut authorities have continued enforcing these requirements against businesses in 2026. 

Do Independent Contractors Need Workers’ Compensation?

Classifying someone as an independent contractor does not automatically eliminate workers’ compensation concerns. Whether someone is legally an employee or independent contractor depends on the actual working relationship and applicable law—not simply the title the business gives them. Connecticut also specifically treats knowingly misrepresenting employees as independent contractors to lower workers’ compensation premiums as a serious violation. 

What Should You Do If Your Business Doesn’t Have Workers’ Compensation?

If your business has employees but doesn't currently carry workers’ compensation insurance, don't assume you're exempt. Requirements vary based on your business structure, workforce, location, and other circumstances. Review your obligations and obtain appropriate coverage as soon as possible if it is required.

Protect Your Employees and the Business You’ve Built

Workers’ compensation isn't simply another item on an insurance checklist—it can be an important part of protecting both your employees and your company from the financial consequences of a workplace injury. Wentworth Insurance is a family-owned independent insurance agency with more than 25 years of experience, over 60 licensed insurance professionals, and clients across 48 states. Because we work with multiple trusted insurance carriers, our team can help business owners evaluate their workers’ compensation options alongside the rest of their commercial insurance program. Contact Wentworth Insurance today to discuss your workers’ compensation needs and make sure your business has the protection it needs.