Many business owners are surprised to learn they may need workers’ compensation insurance even if they don’t have employees. This is where a ghost workers’ comp policy comes in. A ghost policy is a workers’ compensation policy with zero employees listed. It exists to satisfy state requirements, contract obligations, or insurance audits—without paying payroll-based premiums. […]

If you’re a contractor or subcontractor, you’ve probably been asked for a Certificate of Workers’ Compensation—even if you don’t have employees. This requirement exists because: Without a ghost policy, a general contractor’s insurance carrier may: A ghost workers’ comp policy protects both parties and keeps projects moving forward.

While both are workers’ compensation policies, the purpose is very different. Regular Workers’ Comp Ghost Workers’ Comp A ghost policy is not about benefits—it’s about proof and protection. If you later hire employees, the policy can be converted to a standard workers’ comp policy.

Short answer: Very likely, yes. Even though you’re paid as a 1099 contractor: A ghost workers’ comp policy: This is especially common in construction, landscaping, trucking, roofing, and trades.

One of the biggest misconceptions is that workers’ comp is expensive. In reality, ghost workers’ comp policies are very affordable. Typical costs: Pricing depends on: At Upstate’s Choice Insurance, we specialize in low-cost ghost policies designed specifically for owner-only businesses.

While a ghost policy doesn’t provide employee benefits, it can reduce liability exposure in certain situations. Benefits include: Without it, you could be exposed to: A ghost policy is a simple way to protect your business reputation and contracts.

Operating without workers’ comp—even as a one-person business—can lead to serious problems. Possible consequences: Many contractors learn this the hard way during an audit. A ghost policy is often the cheapest fix to avoid these issues.

Business structure matters—but it doesn’t always eliminate the need for workers’ comp. Even if you’re exempt at the state level, contracts override exemptions. A ghost workers’ comp policy bridges that gap.