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Policy Coverage: No Limits, Presumed to Cover All

Workers compensation policy is "presumed to cover all the employees...of the insured.";

The Indiana statute IC 22-3-5-5 specifies that a workers compensation policy is "presumed to cover all the employees and the entire compensation liability of the insured." Also, the Basic Manual Rule 3.A.5.b. states that "All locations and operations of the employer in a state must be insured on one policy if required by the state workers compensation law."

The Indiana Code is available on the State of Indiana website at this address:

Often agents and carriers believe they can split certain exposures of one legal entity. For instance, they may wish to cover aircraft operations on one policy and the normal business on another policy, or split departments under separate policies. The law as shown above does not permit this.

The legal way to accomplish a split in coverages within a state is to create separate legal entities and insure each legal entity's exposure on a separate policy. However, if common ownership exists, the experience of the each entity will be combined under one experience rating.

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The material in this document has been prepared and shared for informational purposes only and should not be relied upon as legal advice on any particular situation.