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Nestled in the heart of the Rocky Mountains, Colorado combines warm hospitality with a pioneering spirit from the frontier days. From the vibrant energy of Denver to the natural beauty of the mountains and canyons, the Centennial State calls out to both those seeking adventure and entrepreneurs alike.
With a robust economy and a diverse range of industries, Colorado presents a wealth of opportunities for businesses to thrive. When it comes to ensuring the well-being of your business and employees, securing the appropriate workers' compensation insurance is of utmost importance.
Workers' compensation is a system of insurance for employers with one or more employees. It’s designed to provide employees who suffer work-related injuries or illnesses with medical treatment and indemnity benefits.
Without workers’ compensation, the cost of a work-related injured or ill employee’s medical treatment could become the responsibility of your business.
Colorado workers’ comp coverage is legally required for all businesses with one full-time or part-time employee (excluding sole proprietors).
Colorado's workers' compensation laws are designed to protect both employees and employers in the event of workplace injuries or illnesses.
Key aspects include coverage for medical expenses, wage replacement benefits, and compensation for permanent disabilities.
Injured employees must report incidents promptly, and disputes can be resolved through the Colorado Division of Workers' Compensation.
Retaliation against employees for filing claims is prohibited, and in some cases, employees can pursue third-party claims. It's important for both employees and employers to understand their rights and obligations under these laws.
Employees can verify online if their employer has coverage.
Policies include protection for full-time and part-time workers.
Exemptions from workers’ compensation in Colorado may include, for example:
Corporate Officers and members of LLCs are automatically included in coverage. If they own at least 10% of the business, they may reject coverage.
If they have less than 10% ownership of the business they can be excluded only if they are not active in the business operations.
For those Officers and Members who choose to be included, they are included at a capped payroll amount and not at their actual wages
For businesses in the construction industry, Colorado has additional insurance requirements. Failure to carry insurance can result in fines.
Workers' compensation covers a range of work-related injuries and illnesses, including physical injuries resulting from an accident and occupational diseases that may develop over time due to job conditions.
Colorado workers’ comp insurance provides three types of benefits for work injuries:
Colorado laws place a limit on how much an employee can receive in combined temporary disability benefits and permanent partial disability benefits. The cap changes each year.
The weekly compensation rate in Colorado is two-thirds of a person’s average weekly wage, and it cannot exceed the state’s average weekly wage.
The maximum temporary disability benefit rate for injuries that occur between July 1, 2023, and June 30, 2024, is $1,293.25 per week.
Find more information on Colorado’s workers’ compensation rates.
When and how to file a workers' comp claim must follow a strict five-step claims process:
This crucial step belongs to the employee. All incidents, big or small, should be reported.
They have ten days after a workplace injury or related illness to notify their employer in writing about the matter. Then, within 10 days of receiving notice, employers must file a claim with their workers' comp insurance partner.
Many partners track how long it takes for a claim to be filed. Continuous late reporting can potentially affect a business’s policy premium.
If an injury is not reported to the employer at the time of the incident, the employee can still file a claim with the Division of Workers' Compensation within two years.
Within 20 days from when the employee files the claim with the Division, an employer must file one of the following:
If employers choose to file for denial of liability, they may apply for an expedited or standard hearing with the Division of Workers’ Comp within 45 days. Expedited hearings will occur within 60 days of the application. Standard hearings occur within 120 days of the application.
In non-emergency situations, we recommend that employers help the employee get medical treatment as soon as possible. Employers can do this by providing a Letter to Injured Worker with a list of designated providers to choose.
If it's an emergency, injured workers should immediately seek treatment from the nearest hospital.
If an employee gets approval from the designated medical provider, they can return to work using a modified duty task list until they have received a full duty work release.
Medical care continues until the medical provider deems the employee has reached maximum medical improvement (MMI).
Once the employee has reached MMI, employers must file a Final Admission of Liability (FAL) with the Division within 30 days of the MMI date.
The claim will close if the employee does not timely object to the FAL.
In non-emergency situations or when emergency care is no longer required, employers must provide the injured worker with a designated provider list.
A designated provider list must:
Exceptions can apply to rural areas, and telemedicine is permissible. If no physician is properly designated, the employee may select the health care provider of their choice.
Payment for medical care is due within 30 days of submission by the employer or insurance partner unless there’s a good-faith reason to request additional information about the invoice.
If the treating physician determines the employee is unable to perform their job duties, temporary total or temporary partial disability benefits must be paid.
The first installment of benefits is due on the 15th day after the employer is notified of the injury. There is no compensation for the first three days of missed work.
Colorado workers and employers looking to address disputes regarding workers' compensation claims have the option to submit either an Application for Expedited Hearing or an Application for Hearing with the Office of Administrative Courts. See forms here. For guidance on initiating a hearing, reach out to the Division's customer service at 303-318-8700 or 1-888-390-7936.
The Workers' Claim for Compensation form (WC 15) must be filed within two years from the date of the injury.
If an injured worker’s claim gets denied, they may be responsible for all related medical bills. However, private health insurance may cover these costs. If employees plan to pursue their claim further, employees should inform their doctor that the injury is work-related but subject to dispute.
Generally, employers in Colorado with one or more employees must carry workers' compensation insurance or qualify for self-insurance. Compliance with these requirements is essential to protect both the employer and employees.
When selecting a workers' compensation insurance provider, consider factors such as the provider's experience in the industry, financial stability, coverage options, claims process, customer service, and cost.
We recommend requesting multiple quotes and comparing the offerings before making a decision.
Covering your business and employees with a trusted insurance partner — like EverPeak — brings peace of mind so you can focus on your bottom line.
Employers who fail to secure workers’ compensation coverage for their business may be subject to penalties of up to $500 per day. Failure to pay may result in a court order urging the employer to halt further employment until they pay the fines or secure workers’ compensation coverage.
In most cases, employees in Colorado are barred from suing their employers for work-related injuries or illnesses. The workers' compensation system provides an exclusive remedy, meaning that employees typically cannot file a lawsuit against their employers. Instead, they must pursue a workers' compensation claim to receive benefits for their injuries or illnesses.
Generally, independent contractors aren’t covered by workers' compensation insurance in Colorado. Workers' compensation laws typically apply to employees rather than independent contractors.
However, it's important to note that the classification of a worker as an independent contractor or an employee can be complex, and misclassification can lead to legal disputes. If you’re unsure about your classification, we recommend seeking legal guidance.
Ideally, the incident should be reported immediately or within a few days of the occurrence. Prompt reporting helps ensure the necessary steps are taken to initiate the workers' compensation claims process.
Employees can verify online if their employer has coverage.