Key Takeaways
- Pennsylvania workers' compensation is mandatory for virtually all employers
- The Pennsylvania Compensation Rating Bureau (PCRB) calculates advisory loss costs
- Employers can obtain coverage through private insurers, the State Workers' Insurance Fund, or self-insurance
- Pennsylvania has specific benefit levels and requirements for injured workers
- Penalties for operating without workers' compensation include criminal prosecution
Pennsylvania Workers' Compensation Insurance
Pennsylvania has a comprehensive workers' compensation system that requires virtually all employers to provide coverage.
Mandatory Coverage
Pennsylvania requires workers' compensation for all employers with one or more employees:
Who Must Be Covered
| Worker Type | Coverage Required |
|---|---|
| Full-time employees | Yes |
| Part-time employees | Yes |
| Seasonal workers | Yes |
| Minors | Yes |
| Executive officers | Yes (can reject in writing) |
| Casual employees | Generally yes |
Limited Exceptions
Some limited exceptions may exist for:
- Sole proprietors (optional for themselves)
- Partners (optional for themselves)
- Certain agricultural workers (with restrictions)
- Domestic workers (limited hours)
Obtaining Coverage
Pennsylvania employers have three options for workers' comp coverage:
Coverage Options
| Option | Description |
|---|---|
| Private Insurance | Purchase from admitted P&C insurer |
| State Workers' Insurance Fund (SWIF) | State-operated insurer |
| Self-Insurance | Approved by the Bureau of Workers' Compensation |
State Workers' Insurance Fund (SWIF)
SWIF is Pennsylvania's competitive state fund:
- Not an insurer of last resort - Competes with private market
- Available to all Pennsylvania employers
- Competitive rates
- Large market share in Pennsylvania
Self-Insurance
Employers may self-insure with approval:
- Must demonstrate financial ability
- Security deposit required
- Subject to Bureau oversight
- Large employers typically
Rate Setting
Pennsylvania uses an advisory loss cost system:
Pennsylvania Compensation Rating Bureau (PCRB)
The PCRB:
- Calculates advisory loss costs
- Maintains class codes
- Files loss costs with the Department
- Collects and analyzes premium and loss data
Insurer Rate Filings
- Insurers file their own rates with the Department
- Apply loss cost multiplier to PCRB loss costs
- Must be actuarially justified
- Experience modification affects individual employer rates
Benefits
Pennsylvania workers' comp provides comprehensive benefits:
Benefit Types
| Benefit | Description |
|---|---|
| Medical Care | All reasonable and necessary medical treatment |
| Total Disability | 66 2/3% of wages (subject to weekly max) |
| Partial Disability | 66 2/3% of wage difference |
| Specific Loss | Scheduled benefits for limb/vision loss |
| Death Benefits | To dependents |
Benefit Limits
| Limit Type | Amount |
|---|---|
| Maximum Weekly Wage | Set annually by Department |
| Total Disability Duration | 500 weeks, then petition for extension |
| Partial Disability Duration | 500 weeks |
| Medical | No dollar limit |
Penalties for Non-Compliance
Pennsylvania has significant penalties for uninsured employers:
| Penalty | Details |
|---|---|
| Criminal Prosecution | Third-degree felony |
| Fine | Up to $15,000 |
| Imprisonment | Up to 7 years |
| Personal Liability | Employer liable for all benefits |
| Stop Work Order | Operations can be halted |
Exam Tip: Pennsylvania takes workers' comp compliance very seriously. Operating without coverage is a felony.
Exclusive Remedy
Workers' compensation is the exclusive remedy for workplace injuries:
- Employees cannot sue employer for negligence
- Trade-off: guaranteed benefits without proving fault
- Exceptions exist for intentional acts
- Third-party lawsuits still possible (against non-employers)
What entity calculates advisory loss costs for Pennsylvania workers' compensation?
What is the criminal penalty for a Pennsylvania employer operating without workers' compensation insurance?