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What is a Workers Comp Ghost Policy and When Do I Need One?

2-minute read

Susan Hamilton

Susan Hamilton

28 February 2023

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As a business owner, you’ve probably heard about workers’ compensation insurance. But have you heard about a workers’ comp ghost policy?

Don’t worry. It’s not as scary as it sounds.

In fact, a ghost insurance policy may be just what you need. If you’re a sole proprietor with no employees, a workers’ comp ghost policy may be the right fit for your small business.

We’re here to explain what a ghost insurance policy is and how to get one.

What is a Workers’ Comp Ghost Policy?

You may already know that small businesses with employees are required by some state’s laws to have workers’ compensation insurance. Workers’ comp provides medical benefits and wage replacement to employees who become injured or sick on the job.

So what is a workers’ comp ghost policy?

A ghost policy is a type of sole proprietor workers’ comp. It’s called a ghost policy because no employees exist, and the policy covers no one.

We know — A ghost policy sounds imaginary.

That’s why we want to be transparent about workers’ comp insurance ghost policies: They are intended only for single-person businesses with no employees, They do not provide coverage to the business owner and they should never replace your state’s requirements for workers’ comp insurance.

If you’re a small business with no employees, you may want to know if your state allows workers’ comp ghost policies.

Here’s why: Many small business owners may want to obtain sole proprietor workers’ comp but don’t want to pay a high premium for workers’ comp insurance. A ghost policy is an affordable alternative if allowed in your state.

Even if your state doesn’t allow ghost policies, we have a separate and affordable solution that includes coverage for business owners.

Why Do Workers’ Comp Ghost Policies Exist?

Why would you need workers’ compensation insurance if you don’t have any employees?

The most common reason for getting a ghost workers’ compensation policy is:

You need to show proof of having workers’ comp insurance.

If another company hires you to work on a project, they may require that you have workers’ comp insurance. With a workers’ compensation ghost policy, you can provide them with a Certificate of Insurance (COI) to prove you have coverage.

What Does a Workers’ Comp Ghost Policy Cover?

Yes, we have options. At Simply Business, we offer two types of sole proprietor workers’ comp insurance for single-owned businesses and subcontractors:

Solo X

Solo X is a workers’ comp policy where the business owner is excluded from coverage. However, the Solo X plan includes an accident policy that provides fixed-amount payouts for certain types of injuries.

Solo I

Solo I is a workers’ comp policy that protects the business owner, much like a traditional workers’ comp policy covers an employee. However, there is no accident policy with a Solo I plan.

Get Insured in Under 10 Minutes

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How Do I Get a Workers’ Comp Ghost Policy Quote?

At Simply Business, we know you’re too busy to spend hours researching insurance questions like how to get a workers’ comp ghost policy So we make it quick and painless. We can get you a free quote for sole proprietor workers’ comp in less than 10 minutes.

Ready to get started?

Is a ghost insurance policy right for you?

A workers’ compensation ghost policy can benefit your small business. You never know when someone may ask you to provide proof of workers’ comp insurance.

With an affordable ghost insurance policy, you’ll have nothing to fear. Your business will have the proof of coverage necessary to seal the deal.

Susan Hamilton

Written by

Susan Hamilton

I've always loved to write and have been lucky enough to make a career out of it. After many years in the corporate advertising world, I'm now a freelance writer—running my own show and contributing to Simply Business. Fun fact: I have three desks in my house, but I still do my best thinking walking in the woods.

Susan writes on a number of topics such as workplace safety, customer sales, and workers' compensation insurance.

This content is for general, informational purposes only and is not intended to provide legal, tax, accounting, or financial advice. Please obtain expert advice from industry specific professionals who may better understand your business’s needs. Read our full disclaimer

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