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Thread Title: My own kids on the payroll
Created On Tuesday December 20, 2005 12:34 PM


jathieme
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Posts: 1
Joined: Dec 2005

Tuesday December 20, 2005 12:34 PM

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Hello,

Yesterday I contacted State Fund to see if I need work comp if I hire my own minor children to work with me in my home office. State Fund said yes. This seems to contradict a thread below, where somebody asked if they needed work comp for their family members, and the reply was No.

In the event that I do need work comp, I've gotten a few quotes online. One agent said the minimum is $1000 annually; another quoted $500 annually. Why the huge difference? Does it matter which company I choose?

I've been self-employed for nine years but have never had a payroll. Thanks for any advice you can offer.

Jennifer

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AuditorBob
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Monday September 15, 2008 1:54 PM

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Hi Jennifer,

I'm not sure which thread you're referring to, but State Fund operates a little differently from private carriers in regard to coverage of residing relatives of sole-proprietors:

[1] State Fund automatically includes residing relatives for coverage and, therefore, their payroll is included when reporting your payrolls and at your annual audit.

[2] Private carriers, however, automatically exclude residing relatives from coverage and, therefore, their payroll is excluded for reporting and auditing purposes. While private carriers may simply refuse to cover minor children, they may unwittingly provide coverage if the audit includes the relatives' payroll for premium computation.

In either case, you may exclude or include residing relatives by endorsement - simply contact your agent (or the State Fund directly) to discuss the pros and cons.

The difference in quotes could be due to the classification the carriers were assigning to your kids; your agent may have provided the carriers with differing estimates of their payroll; or it may be due to differing minimum premium requirements imposed by the underwriting departments to cover minor relatives.

-------------------------
AuditorBob
AuditBible.com
The Indispensable Online Resource for Audit Professionals

Edited: Tuesday September 16, 2008 at 8:08 PM by AuditorBob

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