Maine Workers' Compensation Insurance
By Scott Simmonds, CPCU, ARM, CMC

Workers' compensation insurance in Maine is required of all businesses with employees. This paper will summarize key provisions of the State Workers' Compensation Act.

Coverage Requirement

Employers must purchase workers' compensation insurance unless they qualify as a self-insured organization. Executive officers who own more than 20% of the corporation's stock may elect not to be covered. Sole proprietors and members of a partnership may elect to be covered. Family members of the owners of a business may elect to waive coverage (before an injury and in writing). Limited Liability Companies are treated as sole proprietorships with the exception that family members may not opt out of the system.

Benefits

Workers' compensation provides for payment of medical bills that result from a work related injury or illness. Payments are also made for lost wages after a 7 day wait. An injured employee can receive 80% of gross wages up to $524.18 per week. After an employee is out of work for fourteen consecutive days benefits are paid retroactively to the first day.

Premiums

Premiums are determined based upon the classification and payroll of the business. There are over 600 different employment classifications from Abrasives to Yam Manufacturing. The definition of payroll includes wages, salary, commissions, bonuses, overtime, allowances for food, tools, rents and the like. Payroll does not include tips, group insurance, pension plans, severance pay, employee discounts or the extra pay for overtime work.