A roofing contractor in Chicago should plan on carrying an Illinois workers’ comp policy as soon as the business has employees. The Illinois Department of Insurance says employers in extra-hazardous occupations, such as construction, must have workers’ compensation insurance. This post covers the Illinois paperwork, the out-of-state wrinkle and the questions to put to your agent.
What the Department of Insurance says about coverage
The Illinois Department of Insurance describes the rule in its compliance material for employers. It says Illinois law requires employers to provide workers’ compensation insurance for almost everyone who is hired, injured, or whose employment is localized in Illinois. Its employer FAQ adds that even a part-time employee brings an employer under the Act.
Roofing is construction work, so the optional route open to some businesses should not be assumed for a roofer. The department says sole proprietors, bona fide corporate officers, business partners and members of limited liability companies may elect to come under the Act or choose not to, and then says that election does not apply to employers in extra-hazardous occupations. A Chicago roofing owner should treat that as a reason to ask the agent directly whether the owner is covered under the policy and how.
What happens when coverage is missing
The department is blunt about consequences. It says an employer that knowingly fails to provide workers’ compensation insurance loses the protection the Act gives employers, and that an employee injured while the employer was uninsured may sue in civil court. It also describes a work-stop order that requires cessation of all business operations, and says that if the business is declared extra-hazardous, the Commission may issue the order even before holding a hearing.
For a roofing crew, a work-stop order is not abstract. It stops the tear-off that is already underway and leaves the building exposed. A lapse discovered after a crew is hurt is therefore two problems at once: the injury and the stop on the business, and neither waits for the paperwork to catch up. The roofing workers’ comp by state post compares how other states handle the same question.
Real-World Scenario: A roofing company from outside Illinois wins a commercial re-roof in the Chicago area and sends its usual crew. The owner assumes the home-state policy follows the crew. A worker is hurt on the second day. The owner who asked the agent beforehand learned whether Illinois was on the policy. The owner who did not is now reading the policy for the first time while the claim is open.
The roofing license application asks for proof
The Illinois Department of Financial and Professional Regulation publishes the roofing contractor license application, and the application ties insurance to the license. The instructions say that if the applicant answers yes to having employees, the application must include proof of workers’ compensation insurance for roofing in the form of a certificate of insurance from the insurance provider. A self-insured business submits the certificate of approval as a self-insurer from the Illinois Workers’ Compensation Commission instead.
The same instructions say a separate supporting document, the RF-INS form, must be completed and submitted, and that this is the only proof of liability and property damage insurance the department will accept. Your agent completes that form. The form is a reminder that the license cares about the liability policy as well as the comp policy, which the general liability coverage page explains.
Crews that cross the state line
Chicago draws contractors from neighboring states, and the Illinois agencies address that case directly. The Department of Insurance says that if an out-of-state company conducts business with its employees in Illinois, even if the workers reside outside Illinois, that company must provide a workers’ compensation policy that includes Illinois coverage for those workers. It adds that only a policy that includes Illinois on its coverage is valid.
The license application carries the same idea for out-of-state businesses. It says an out-of-state business submits an out-of-state workers’ compensation insurance form containing either an all-states endorsement clause or a clause stating that the policy will cover Illinois accidents and pay benefits under Illinois law. Ask your agent to read the policy’s state listings and any all-states endorsement out loud before you cross the border.
How others verify your policy
The Illinois Workers’ Compensation Commission says its Employer Insurance Coverage Search provides information for employers that have bought a workers’ compensation policy, based on the National Council on Compensation Insurance database, and for employers that obtained approval to self-insure. The Commission also says the database does not include Illinois employers in self-insurance pools, which are regulated by the Department of Insurance.
The practical point is that a policy on paper is not the only evidence. A general contractor or property manager can look an employer up, and a mismatch between what you hand over and what the search shows is the kind of thing that stalls a contract. The GC requirements post covers what happens on the contract side.
Family members, part-time help and the owner’s own crew
A small roofing company can run on family labor, and the Illinois Department of Insurance answers the question directly: employees who are family members must be insured, unless they are bona fide corporate officers or work for a qualifying agricultural enterprise. The same page says that even a part-time employee brings an employer under the Act.
For a roofing owner, that means the cousin who helps on weekends and the son who works summers belong in the payroll conversation with the agent. Do not leave them off the estimate because they are family. Ask the agent how they are classified and what the policy says about them, and keep a record of who worked and when, because the audit will ask.
What the Act itself says about construction
The Illinois Workers’ Compensation Act is the source of the extra-hazardous language the Department of Insurance applies. The Act lists the erection, maintaining, removing, remodeling, altering or demolishing of any structure among the enterprises it covers. A tear-off and reroof is the removing and altering of a structure’s roof, which is the plain reason a roofing owner should read the construction language as applying to the business rather than hunting for a way around it.
If the contract or the job site is unusual, such as a wrap-up program or a site with its own insurance program, ask the agent how that program interacts with your own policy before you assume either one covers the crew.
The rest of the license paperwork
The roofing license application bundles more than the comp certificate. The instructions say a qualifying party is required for any roofing contractor license in Illinois and must pass an examination. They say an applicant with employees must also submit a statement of account from the Illinois Department of Employment Security showing the unemployment insurance account number and that the business is not delinquent. And they say a bond form must be completed by a bonding company licensed to do business within the State of Illinois.
None of that is workers’ comp, but all of it is part of the same file. If you hire an agent to help with the application, ask who is responsible for each document and who calendars the renewal. A renewal that is missing one certificate is a license problem. The do roofing contractors need a license post compares how states approach roofing licensing.
What to confirm with your agent
- Is Illinois listed on the policy, and is there an all-states or Illinois endorsement if the business is based elsewhere?
- Which classifications and payroll figures are on the policy, and do they match the work crews perform in Chicago?
- How is the owner covered or excluded, and does that choice affect the license paperwork?
- Do subcontractors on your jobs carry their own policy, and where is the certificate?
- Is the certificate for the license application current and issued by the insurance provider?
- When is the audit, and what records will the auditor request?
For the state overview, see the Illinois state page, the Illinois cost guide, the workers’ compensation coverage page and the roofing insurance hub. To start on your own policy, use the quote page. Sources: the Illinois Department of Insurance compliance page, the Illinois Workers’ Compensation Commission coverage page and Act, and the roofing license application from the Illinois Department of Financial and Professional Regulation. This post is general education, not legal or tax advice.