Protect Your Employees and Your Business
In Arizona, workers’ compensation insurance is not optional — it is required by law. Under the Arizona Workers’ Compensation Act, virtually every employer with one or more employees must carry workers’ compensation coverage. This requirement exists to protect workers who are injured or become ill as a result of their job duties, ensuring they receive medical care and income replacement without having to sue their employer. It also protects business owners from catastrophic out-of-pocket expenses when workplace accidents occur. Whether you run a small landscaping company in Scottsdale or a mid-size construction firm in Phoenix, workers’ comp is a legal necessity and a vital business protection.
What Does Workers' Compensation Insurance Cover in Arizona?
Medical Benefits
Covers all reasonable and necessary medical treatment for work-related injuries and illnesses, including emergency care, doctor visits, surgery, physical therapy, prescription medications, and medical equipment. There is no limit on the duration of medical benefits for accepted claims.
Temporary Disability Benefits
If an employee cannot work while recovering from a work injury, they receive wage replacement benefits equal to 66⅔% of their average weekly wage, up to the state maximum. Benefits begin after the first seven days of disability.
Permanent Disability Benefits
If a workplace injury results in a lasting physical impairment, the employee may receive permanent partial disability (PPD) or permanent total disability (PTD) benefits based on the severity and impact of the injury.
Employer Liability Protection
Workers' comp also protects employers from civil lawsuits filed by injured employees, providing a legal shield that limits your financial exposure.
Death Benefits
If a workplace accident results in an employee's death, their dependents receive burial expense reimbursement and ongoing income replacement benefits.
Arizona Workers' Compensation Law – What Employers Must Know
- Coverage is mandatory for any business with one or more employees, including part-time employees, minors, and in most cases, undocumented workers
- Sole proprietors and partners are exempt from coverage but can elect to cover themselves
- Corporate officers may be excluded under certain conditions, but must formally file for exemption
- Penalties for non-compliance include civil fines, potential criminal charges, and personal liability for all injury-related expenses — potentially hundreds of thousands of dollars
- Posting requirements – Arizona employers must post the name of their workers' comp carrier in a visible location in the workplace
High-Risk Industries in Arizona That Need Strong Workers' Comp Coverage
- Construction – Falls, equipment injuries, and heat-related illness are leading causes of workers' comp claims in Arizona's booming construction sector
- Manufacturing and Warehousing – Repetitive motion injuries, forklift accidents, and machinery-related injuries
- Agriculture – Heat exhaustion, pesticide exposure, and machinery injuries
- Healthcare and Home Care – Patient handling injuries, slips and falls, and exposure to illness
- Landscaping and Outdoor Services – Heat stroke, tool injuries, and vehicle accidents
- Retail and Food Service – Slip and fall injuries and repetitive strain
How Workers' Comp Premiums Are Calculated in Arizona
Your workers’ compensation premium is based on:
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Payroll – The larger your payroll, the higher the base premium
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Industry classification code – Higher-risk industries pay higher rates per $100 of payroll
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Experience modification factor (X-Mod) – Your claim history compared to similar businesses; a clean record earns a credit modifier and lower premiums
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Safety programs – Documented safety training and programs can qualify your business for premium discounts
How to Reduce Your Workers' Comp Costs in Arizona
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Implement formal workplace safety programs and document all training
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You transport goods, tools, or equipment for business purposes
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You regularly drive to client sites, job sites, or business locations
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You have employees who drive the vehicle
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The vehicle is heavier or larger than a standard passenger car (trucks, vans, specialty vehicles)
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You use the vehicle for delivery or rideshare services
Protect Your Business the Right Way
Your business is too important to trust to insurance companies that see you as just another policy number. As a family-owned, independent agency, we understand what it takes to build and protect a business in Arizona.Your business is too important to trust to insurance companies that see you as just another policy number. As a family-owned, independent agency, we understand what it takes to build and protect a business in Arizona.
- Phone: 602-584-8591
- Hours: Mon-Fri 8:30am-5:00pm
- Address: 1176 E Warner Rd Suite 107 Gilbert, AZ 85296
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