A general contractor asks for a workers’ compensation certificate before you can start a job. You own the business, do the work yourself and have no W-2 employees. A low-cost policy sounds like the quickest way to satisfy the request. Before buying it, find out whether you would actually be included in the coverage.
A ghost workers’ comp policy generally describes a policy for a business reporting no employee payroll, with the owner excluded. Owner coverage addresses a different question: whether the person doing the work is insured under the applicable policy or program. The label, certificate and price cannot answer that on their own.
If you are comparing workers’ compensation options for your business, start with your business structure, the work you perform and the people who need to be covered. Then compare the written terms.
What a ghost workers’ comp policy means
“Ghost policy” is an industry description rather than a promise of a particular set of benefits. Insureon describes a minimum-premium ghost policy as an arrangement for owners without employees who need evidence of workers’ compensation insurance, while the owner remains excluded.
That distinction matters on a jobsite. A certificate may show that a policy exists, but an excluded owner should not assume it provides workers’ compensation benefits for their own injury. Ask the issuing professional to identify the relevant inclusion or exclusion in the policy documents.
Do not choose an arrangement simply because someone calls it a ghost policy, an owner-only policy or a no-payroll program. Ask what the actual documents say about you, your business and your work.
A certificate and a Florida exemption serve different purposes
A certificate of insurance provides evidence about an insurance policy. A Florida exemption concerns an eligible individual’s election to be exempt from workers’ compensation coverage. Having one document does not automatically satisfy every requirement associated with the other.
Florida’s coverage requirements depend on the industry, business structure and employee count. Construction employers generally face a one-employee threshold, with owners included in the relevant definitions unless a valid exemption applies. Rules for non-construction businesses differ.
Review the state’s construction exemption eligibility requirements if you are considering an exemption. An eligible LLC member and a sole proprietor should not assume the same rules apply to both.
You also need to understand the hiring contractor’s written insurance requirements. Ask for those requirements before requesting a quote. A general request for “a certificate” may leave unanswered questions about owner inclusion, the work described and required endorsements.
Compare these five points before paying
Who is included in the coverage
Ask whether the owner is included or excluded, and where that appears in the documents. If there are employees, identify them accurately. If you sometimes bring in helpers or subcontractors, disclose how those relationships work rather than describing the business as having no workers.
What operations the proposal reflects
Describe what you actually do. A contractor who installs cabinets and occasionally performs framing should explain both activities. Ask the specialist to confirm that the proposal reflects the operations and locations discussed.
What the certificate can establish
Provide the job’s insurance requirements and ask which items can be shown on the certificate. If an endorsement is required, request confirmation of that endorsement rather than assuming certificate wording creates coverage.
What you must pay and report
Request the complete payment structure: premium or program charges, administrative fees, payment timing, reporting requirements and any applicable minimums. Ask whether an audit or reconciliation can apply. Compare total obligations over the same period.
What happens when the business changes
Ask what must happen before adding an employee, changing trades or working in another state. An arrangement designed for an owner operating alone may need to change when the workforce changes. Put a review date on the calendar before the expected hire or project start.
A practical example for an owner working alone
Consider an LLC owner who performs remodeling work and has been offered a new subcontract. The hiring contractor requests proof of workers’ compensation, and the owner also wants protection for their own work-related injury exposure.
The useful comparison is not simply which option produces a certificate fastest. The owner needs to know whether each proposal includes them, fits their work and satisfies the hiring contractor’s requirements. A cheaper proposal with an owner exclusion may address a different need from a program that includes the owner.
This example is illustrative. It does not establish eligibility, a coverage determination or a quoted price. Those depend on the actual application and documents.
When to ask about an owner-only program
If you operate without W-2 employees, Paycorp HR’s Owner-Only LLC Workers’ Compensation Program may be worth reviewing. Qualifying owners can explore a structure that does not require traditional payroll processing.
Eligibility depends on your business structure, location, operations and underwriting requirements. Ask the specialist to explain owner inclusion, policy or program terms, payment obligations and the process for adding employees later. Do not assume every LLC qualifies or that a sole proprietor can enroll under identical conditions.
Bring your business registration, a clear description of your work, employee information, existing insurance documents and the contract’s insurance requirements. Having those details ready makes the conversation more specific and helps identify missing information before a job deadline.
Frequently asked questions
In the usual industry description, the owner is excluded. Confirm the actual policy documents and any applicable elections or endorsements before relying on coverage for yourself.
No. Paycorp reviews the business structure, work performed, operating location and other program requirements. Having no W-2 employees is relevant, but it is not an approval by itself.
Do not assume that it can. A state exemption and a certificate of insurance serve different purposes. Review both the applicable Florida requirements and the hiring contractor’s written conditions.
Contact your coverage specialist before the employee begins work. Review the required coverage, payroll setup and changes to any owner-only arrangement. Paycorp also offers payroll support for Florida contractors when your workforce grows.
Before buying a policy to obtain a certificate, make sure you understand who it covers and what it requires. Share your documents with a specialist and compare the proposed solution against your actual work and contract.
Check your Owner-Only eligibility with Paycorp HR to review whether the program fits your business.