All businesses need insurance and many types are available to small business owners in Idaho. Some types of insurance are required by law and others are optional. For information about a specific type of insurance, choose from the following:

Required Insurance: Businesses with employees are required to carry the following two types of insurance, with few exceptions.

WORKER'S COMPENSATION INSURANCE: Businesses having employees are required to carry worker's compensation insurance, which is administered by the Idaho Industrial Commission. Worker's compensation insurance is no-fault insurance that covers lost wages and provides medical benefits for workers who sustain a job-related injury or illness. Workers comp also provides rehabilitation services for injured employees.

Employers can obtain worker's compensation insurance through one of four options:

• Private Insurance Company – More than 300 private insurance companies are authorized to issue worker's compensation insurance in Idaho. To find a company, contact an insurance agent or visit the  Idaho Department of Insurance Web site at http://www.doi.state.id.us/insurance/LinesList.aspx?Line=06 and search for companies authorized to do business in Idaho by company lines..   
  
  
• State Insurance Fund – Companies may choose to obtain worker's comp coverage through the State Insurance Fund. For information, visit their Web site at http://www.idahosif.org/ or call (208) 332-2100 or 1-800-334-2370.
  
  
• Assigned Risk Pool – Employers considered to be high risk and who are unable to obtain coverage from private insurance companies or the State Insurance Fund can apply for coverage through the assigned risk pool. The pool is administered by the National Council on Compensation Insurance (NCCI). Contact your insurance agent or call NCCI at 1-800-622-4123 for more information or visit their Web site at http://www.ncci.com/.
  
  
• Self-insurance – This option is available to Idaho employers who have large payrolls and who are able to meet specific requirements. Approval for self-insurance must be granted by the Idaho Industrial Commission.

Some types of employment are exempt from Worker's Compensation coverage. For more information, click the box on the right.

UNEMPLOYMENT INSURANCE - State and Federal 

All businesses that have employees are required to carry Unemployment insurance. The insurance is actually a tax paid by the employer, not insurance. State unemployment taxes are administered by the Idaho Department of Labor. The Internal Revenue Service administers the federal unemployment tax. For information, visit the Taxes section of this Web site.

Stabilizing the Economy:  Besides helping unemployed individuals and families transition from one job to another, unemployment insurance (UI) acts as an automatic economic stabilizer. In a recession, UI benefits offset some of the effects of job losses on a community's spending power. Because UI benefits allow unemployed individuals and their families to continue to pay their bills, it helps maintain the incomes and spending power of the stores, landlords, banks, and service providers in the community. UI softens the blow and reduces the snowball effect of job losses.

Retaining a local workforce:  Unemployment insurance (UI) promotes stability by making it possible for employers to retain workers during the business's slow season or during a short downturn in business. Many seasonal industries would find it much more difficult to attract and retain employees if their workers could not rely on UI to support them through the off-season.

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Other Types of Insurance You May Need:  The following types of insurance are available and may be needed for your particular type of business. Home-based businesses may have special needs in addition to those listed below. Talk to your insurance agent or professional association about availability and cost.

Some types of insurance may not be legally required, but potential customers may not do business with you unless you have the coverage. Two examples are surety bonds and fidelity bonds.

Surety Bond - Guarantees that you have the financial capacity to perform the service for which you have been hired. Very common in the construction industry. Contact your insurance agent for information on securing a bond.

Fidelity Bond - Protects you against employee dishonesty and theft. This is a necessity if your employees go into the homes or businesses of clients. Contact your insurance agent for information on how to obtain a bond.

Health Insurance - Providing health coverage for yourself and your employees is an important benefit that may help you recruit and retain employees.

A policy can cover an individual (you, the business owner) or a group (you and your employees). For a list of companies approved to sell health insurance plans to Idaho businesses, visit the Idaho Department of Insurance Web site at http://www.doi.state.id.us/health/smempl_list.aspx or call them at (208) 334-4250 or toll-free at 800-721-3272.  

If you provide health insurance and you have 15 or more employees, the federal Civil Rights Act requires you to provide maternity benefits even if you have no female employees. For information, visit http://www.doi.state.id.us/consumer/empl_maternity.aspx or call the Idaho Department of Insurance at (208) 334-2873, or toll-free 1-888-249-7025 (in Idaho only).

If you have employees who pay court-ordered child support, you may be required to enroll their dependent children in your company's health insurance program. For information, visit the Employer Issues page of this Web site and look for "Child Support Payroll Deductions."

If you are a small or mid-sized business and you are a member of the Boise Metro Chamber of Commerce, you can enroll in a group health plan created in cooperation with Blue Cross of Idaho and Regence BlueShield. The plan offers savings of up to 22% to qualified businesses.  For information, visit http://www.boisechamber.org/about/Health_Plans.htm.  

Unlike some states, Idaho does not have a state-mandated disability insurance program for employees other than the coverage offered by Worker's Compensation and your company health plan. Therefore, it is particularly important to provide health insurance if possible.

If your business offers health insurance to employees, you will need to use a National Standard Employer Identification number for electronic claims reporting. The Department of Health and Human Services recommends that businesses use their Federal Employer Identification Number as their health insurance identification number. For information, visit http://www.hhs.gov/news/press/2002pres/hipaa.html.  

For information on how to obtain a Federal EIN, also called a Tax Payer Identification Number, visit the Hot Topics section of this Web site and look for "Tax Payer Identification Number."

Caution - Numerous companies sell bogus health insurance plans, particularly to small businesses and the self-employed. The plans may be promoted as association plans or union plans. Before you sign up for any insurance plan, contact the Idaho Department of Insurance to find out whether the plan and the selling agent are licensed to do business in Idaho. Though the agent may tell you that he/she doesn't need a state license, that is incorrect. Anyone selling insurance in Idaho must be licensed.

General Liability - Protects you if someone suffers a bodily injury while on your premises or your employees damage the property of a customer.

Product Liability - Protects you against lawsuits for injury or property loss due to a product defect or design flaw.

Completed Operations (Errors and Omissions) - CPAs and other licensed professionals may need this type of insurance to protect themselves against errors or omissions in the products or services they provide to their clients.

Professional Liability - Protects professionals (doctors, lawyers, dentists, etc.) against malpractice suits.

Automobile/Fleet - Called fleet insurance, coverage is similar to automobile insurance carried by individuals. If your business owns a vehicle that is used primarily for business purposes, your private auto insurance may not provide coverage.  If you use your personal vehicle in your business, you may need special insurance coverage called "non-owned automobile coverage."  Your insurance agent can provide details.

Business Liability (Fire and Theft) - Protects company equipment or assets that are stolen or damaged. This may also be called Property Insurance.

Business Interruption - Protects against loss if the business is interrupted by a natural disaster, such as a fire or flood. This insurance supplements Business Liability coverage. 

Key Person - Protects against financial loss caused by the death or disability of a key person in the business, including the owner. Also used to fund buy/sell agreements when a business has more than one owner. This may also be available for key employees who are members of the National Guard and who could be called to active duty.

Life Insurance - Can be individual (on you, the business owner) or group (on you and your employees).

Officer & Director - Officers and directors of a corporation may be held personally liable for their actions on behalf of your company. This insurance will protect them. Some individuals may not be willing to serve on a board of directors without this coverage.

Pension Plan - Not an insurance but may be needed to recruit and retain good employees. See the Employer Issues section of this Web site for information.

Employment Practices Liability Insurance (EPLI) - Protects against wrongful termination and discrimination lawsuits.

Property Insurance -Covers buildings owned by the business and their contents. A policy may cover such additional items as outdoor signs and glass breakage. 

Umbrella (Supplemental Liability) - Additional liability coverage beyond that offered by a primary liability policy. This may be needed by businesses engaged in high-risk activities. 

Home-Based Business - If you work from your home, you may need additional coverage beyond that offered by your homeowner's policy. Check with your insurance agent to be certain that you are fully covered. Not all home-based business activities are covered by homeowners' insurance, particularly if the actual activity, such as painting houses, does not occur at your office. If you need additional coverage, contact an independent insurance agent who represents multiple companies. They can help you obtain the best coverage to fit your particular needs.

Insurance Fraud: If you suspect that an insurance company, agent, or employee may have committed fraud by violating insurance laws or regulations, you can file an on-line report with the National Association of Insurance Commissioners (NAIC) at https://external-apps.naic.org/ofrs/ and with the Idaho Department of Insurance at http://www.doi.state.id.us/investigations/investigation.aspx.