If you’re an employer and have questions for KEMI, we’re here to help. If you can’t find the answer to your question here, please contact us and we will be happy to serve you.

General Questions

What is workers' compensation insurance coverage?

Workers’ compensation insurance (workers’ comp) is a form of insurance paid by employers which covers an employee’s medical expenses and lost wages if they are injured on the job or acquire a work-related illness.

Is workers' compensation insurance coverage required for all Kentucky employers?

Workers’ comp coverage is required in Kentucky for all organizations with at least one employee, however there are a limited number of employee and employer exceptions to this requirement. If you are unsure about whether you need to purchase coverage, you can consult with an independent insurance agent. Find an Agent »

If an employee or officer elects to not be covered by the workers’ compensation statutes, they may obtain and file a Form 4 with the Kentucky Department of Workers’ Claims.

How do I obtain coverage from KEMI?

Whether you work with an agent or contact KEMI to obtain coverage, your journey will start with submitting an application. Find an Agent »

Once we receive your application, a KEMI underwriter will evaluate the risks associated with your organization and your industry, then calculate insurance premium based on five key factors.

When should an incident be reported to KEMI?

A First Report of Incident should be submitted any time an employee is injured as a result of the employee’s job. As required under Kentucky law (KRS 342.038), the incident, regardless of severity, should be reported to KEMI as soon as possible, but at least within three (3) days of occurrence.

Timely reporting is critical to maintain compliance with the law, control costs, and maximize service to all affected parties.

How do I report an incident to KEMI?

The fastest and easiest way to report an incident or illness is through submitting the First Report of Incident online. A claim may also be reported by printing the First Report of Incident or Illness, or IA-1 form, and faxing it to 859-425-7822 or mailing to the address below:

ATTN: Claims Unit
P.O. Box 12500
Lexington, KY 40583-2500

To report a claim by phone, call 1-800-640-KEMI during business hours (Monday – Friday from 8 a.m.-5 p.m. Eastern Time).

Policy & Billing Questions

Does KEMI offer payment plans?

Yes! If you are considering coverage and would like to learn more about our payment plan options, contact us.

Why am I being audited?

When KEMI issues your policy, your premium is calculated based upon your payroll estimates for the year, so the purpose of the audit is simply to obtain and verify the information necessary to compute the actual premium (versus the estimated premium) for your policy period. Some policyholders may receive a refund at the end of the year, and others may owe additional premium if their payroll was higher than estimated. Learn more about the audit process here.

What is a class code and how is it determined?

Classification codes are established by the National Council of Compensation Insurance (NCCI). The classification system is designed to group employees with similar exposures (risk of incident) into the same classification. There are approximately 600 classifications describing various operations.

Each employer is assigned a governing class that best encompasses the primary exposures faced by their organization. It is important to note that classification codes are assigned based upon the operations of the insured, and not the duties of individual employees within the organization. If you have questions concerning class codes, contact us.

What is an experience modifier and how is it developed?

An experience modifier (sometimes called an experience modification or e-mod) is an adjustment of an employer’s premium for workers’ compensation coverage based on the losses the insurer has experienced from that employer. Typically, three full years of payroll and loss information is used in the calculation and produces a factor that is applied for one year.

The experience modifier is calculated by the National Council on Compensation Insurance (NCCI) according to the terms of the Experience Rating Plan Manual. The plan is mandatory for all employers who qualify (in general, an average of $5,500 in premium for three years). 

The average experience modifier for a given industry is a factor of 1.0. If the actual claims experience in the rating period is higher than the expected claims experience for the industry, the experience modifier will be above 1.0 and will increase the premium calculation. An experience mod above 1.0 suggests an employer is more likely to have claims than other employers within its industry.

Conversely, if the actual claims experience for an individual employer was lower than the expected claims experience for the industry, the experience modifier would be below 1.0 and will decrease the premium calculation. This factor would suggest an employer is less likely to have claims than other employers within its industry.

If a business does not qualify for experience rating, a factor of 1.0 is used in the premium calculation.

What is the Special Fund Assessment?

The Special Fund Assessment is imposed by the Commonwealth of Kentucky to fund and pre-fund the liabilities of the Special Fund and help finance the state workers’ compensation program (including the Kentucky Department of Workers’ Claims and portions of the Kentucky Department of Labor).

Insurance carriers are required by Kentucky statute to add the Special Fund assessment to the total premium charged to an employer for workers’ compensation coverage. The full amount of the assessment is transferred by the carrier to the Kentucky Workers’ Compensation Funding Commission on a quarterly basis.

Are employees covered while working in another state?

The KEMI workers’ compensation policy provides coverage for Kentucky benefits as provided by the extraterritorial provisions of the Kentucky Workers’ Compensation Act, KRS 342.670.

Can an employer be charged for outside labor and subcontractors?

The Kentucky Workers’ Compensation Act requires an employer to provide coverage to employees, including employees of any uninsured subcontractor hired. KEMI will collect premium from the policyholder for any employee of an uninsured subcontractor.

If the subcontractors have their own workers’ compensation insurance, you must provide KEMI with a valid Certificate of Insurance for the period that work was performed. A KEMI auditor may then make the determination not to charge premium for the insured subcontractors.

We will not charge premium for an individual we deem to be an independent contractor. Independent contractors are not covered under the Workers’ Compensation Act. Your auditor must consider several factors to make the determination of independent contractor versus employee. To do so, the auditor may ask you to provide the following: (1) invoices for the work completed; (2) a copy of the contract between the policyholder and the contractor (3) a completed KEMI Independent Contractor Questionnaire or any documentation the auditor considers necessary to determine an independent contractor status. The fact that a person is issued a 1099, with no taxes withheld, is not solely determinative of independent contractor status.

What is a KEMI independent contractor questionnaire?

The Independent Contractor Questionnaire (ICQ) is a tool utilized by KEMI to assist in the determination of an employment relationship. Policyholders must be aware they may be charged for subcontractors/contractors at the audit if the forms and supporting documentation do not disprove an employee relationship. Supporting documentation, including contracts, invoices, and business cards will be necessary.  Obtaining Workers’ Compensation Certificates of Insurance on your subcontractors is the best way to avoid charges and potential liability. 

Note: The ICQ is merely a tool. It is not a substitute for coverage. Simply filling out and signing the form does not mean an individual is considered an independent contractor. The ICQ form must be filled out by the worker/contractor in its entirety for each relevant policy period.

Click here for the Independent Contractor Questionnaire.

How can I obtain a Drug-Free Workplace certification to be eligible for a premium credit?

Applications for certification of the drug-free workplace are currently being accepted by the state of Kentucky. To learn more about this certification, click here.

If your business’ drug-free workplace program is certified by the state of Kentucky, you must submit proof of the certification to KEMI to receive a credit on your workers’ compensation premium. The program and certification must remain in place for the entire policy term to earn the premium credit.

For companies designated as a licensee of the Office of Mine Safety and Licensing (OMSL), you may submit a written copy of your drug-free workplace program to OMSL for certification. If the program is certified by OMSL, the company must submit proof of the certification to KEMI in order to receive a 5% credit on its workers’ compensation insurance premium. The program and certification must remain in place for the entire policy term to earn the premium credit.

How do I cancel a policy?

To request policy cancellation, submit one of the following:

  • Completed Acord Form 35 – Cancellation Request/Policy Release
  • Written notice which should include the effective date of cancellation and the reason for cancellation.  The notice must be signed by an officer/owner of the policyholder; or
  • Click here and complete the KEMI Policy Cancellation Request Form