Michigan Workers’ Compensation Insurance

Does Michigan Require Workers’ Compensation?

Chances are, your Michigan business is required to have workers’ compensation insurance. You’ll need workers’ comp if you have three or more employees, or one employee working more than 35 hours per week for 13 weeks or longer.¹

Both public and private employers need Michigan workers’ compensation coverage.² This insurance gives benefits to employees to help them recover from work-related injuries or illnesses.

Michigan Workers’ Compensation Coverage

Michigan workers’ compensation benefits include:³

Specific loss benefits for certain claims. For example, if a worker loses a thumb because of their job, they’re entitled to 65 weeks of compensation benefits, regardless if they’re disabled.⁴
Disability benefits for employees that get a temporary or permanent disability from a work-related injury or illness.
Medical benefits to help pay for an employee’s treatment costs if they get hurt or sick from their job.
Rehabilitation benefits for retraining costs if your employee can’t return to the same job that they had before the injury or illness.
Wage-loss benefits to help replace lost wages if an employee has to miss work to recover.
Death benefits to help cover funeral costs if an employee loses their life in a work-related incident. The rate is 50% of the state average weekly wage as of the date of injury.⁵

Michigan workers’ compensation insurance also helps protect employers. If an employee or their family sues your business, this coverage can help pay your legal costs.

Who Needs Workers’ Comp Insurance in Michigan?

Most businesses in Michigan need workers’ comp insurance, according to Michigan’s Workers’ Disability Compensation Act. The state also requires all public employers to carry coverage.⁶

Be aware that there are exemptions to the state law, such as:

Agricultural employers, unless they have three or more employees working more than 35 hours a week for 13 weeks.⁷
Domestic workers, like housekeepers.⁸
Partners and officers of a partnership and corporation.
Sole proprietors who are considered self-employed. Employees of sole proprietorships will need workers’ comp coverage.⁹
Family members working for a relative as an employee.¹⁰
Independent contractors that a business hires to do work.¹¹

It’s important to be familiar with Michigan’s laws and regulations. If you don’t comply, your business can face fines or penalties.

How Does Workman’s Comp Work in Michigan?

Starting from their first day on the job, your employees can get workers’ comp benefits if they get a work-related injury or illness. Generally, these benefits are 80% of the worker’s average weekly wage before they got hurt or sick.¹²

The Michigan Workers’ Disability Compensation Act also outlines treatment options and waiting periods if an employee gets hurt or sick from their job.

During the first 28 days, you can choose your employee’s doctor for treatment. After that, your employee can choose their own doctor, but must notify you and your insurance company. In Michigan, insurance companies and employers don’t have to authorize treatment for employees as long as their claim isn’t in dispute.¹³

Employees also have a seven-day waiting period for wage-loss benefits. This means if an employee’s work-related injury or illness prevents them from working for longer than seven days, they’ll get wage loss benefits on the eighth day. If they don’t get wages for 14 consecutive days or longer, they can get paid for the first seven days they missed.¹⁴

Filing a Claim for Workman’s Comp in Michigan

You’ll have to file a claim for workman’s comp in Michigan within two years of your employee’s work-related injury or illness. Otherwise, you’ll need to file it within two years from the date that an injury or illness shows up.

To file a claim for Michigan workers’ compensation, visit our claims page today.

If there is a dispute over a claim, your employee can notify the workers’ compensation bureau and file an “Application for Mediation or Hearing.”¹⁵You’ll then have to file a form to respond to the worker’s application and you’ll likely receive a mediation hearing.¹⁶

The bureau assigns a mediator and you and your employee will try to come to a resolution. If there’s no agreement, the dispute goes to a trial before a workers’ compensation magistrate.¹⁷