Am I covered as the owner?

Only if the policy takes you in. In California, a sole proprietor is covered only if the policy names the owner or an endorsement adds the owner, and corporate officers are covered unless they elect exclusion. In Texas's printed manual, the partners, officers and others exclusion endorsement (WC 42 03 08) removes named people from coverage and from the premium base, and the owner repays the insurer for anything it must pay for them.

What does a ghost policy cost?

The insurer's minimum premium for your classification. Each insurer sets its own minimum, and in California it files that minimum with the state in its rating plan, so ask your agent for the exact figure before you apply. The final premium can still rise at audit.

Can a ghost policy stand in for coverage on my contract drivers?

It does not remove the question. The premium basis reaches anyone whose work could expose the insurer to a claim, unless you prove their own employers secured coverage. Contract drivers who give you no certificate are the people an auditor can add to your payroll.

Ghost Policy Workers Comp: Zero-Payroll Coverage

What is a ghost policy?

Ghost policy is the trade name for a workers’ compensation policy written with an estimated payroll of zero, so the premium is the insurer’s minimum. The label does not appear in the standard policy form. California’s insurance department defines a minimum premium as the smallest amount an insurer will accept to take on a risk, set to cover the cost of issuing and servicing the policy. The workers’ comp guide covers who must carry coverage in the first place.

The policy is priced twice. The figure printed on the information page is only an estimate. After the policy ends, the standard form (WC 00 00 00 B, printed in Texas’s manual) sets the final premium from actual payroll, and it never drops below the highest minimum premium for the classifications. Minnesota’s statute names the same arrangement a “zero estimated exposure policy” (its labor department also calls it an “if-any policy”) and, from 2026, adds attestation and notice rules for building construction employers.

Does a ghost policy cover anyone?

It covers whoever the workers’ compensation law counts as your employee, even though nobody is named. Part One of the standard form promises to pay the benefits the workers’ compensation law requires of you when they come due, and it does not list employees by name. Owners are treated separately. In California a sole proprietor is covered only through a policy statement or an endorsement. In Florida, once an exemption is issued, the officer or LLC member counts as a non-employee who cannot collect benefits. A company that excludes its owner and has no staff holds a policy that pays no one until someone else is found to be an employee.

Why would a NEMT owner with no employees buy one?

Because a broker or customer asks for proof of coverage. Three examples:

MTM. Its Pennsylvania provider agreement (2023 copy) lists workers’ compensation at the statutory amounts, and a provider with no coverage on its drivers has to document the exemption. The 1099 guide explains the clause.
MediTrans. The MediTrans provider page for Louisiana lists workers’ compensation “or approved waiver,” and offers a Workers Compensation Waiver form aimed at owner-operators who have no staff.
New York. The state’s Workers’ Compensation Board says general contractors routinely demand proof of coverage from subcontractors, so some sole proprietors and small corporations that are not legally required to carry coverage buy a policy to get the work.

A ghost policy answers the certificate demand. An exemption or waiver answers it another way, and which one a contract accepts is written in its insurance clause.

Ghost policy or exemption: which one does the contract accept?

Read the proof clause before buying either, because exemption rules are state-specific and personal to the person exempted:

Florida. The state issues an exemption to the individual officer or LLC member, never to the company. The applicant files a Notice of Election to be Exempt online and must sign personally. A non-construction sole proprietor or partner is not an employee unless they elect coverage.
New York. The Certificate of Attestation of Exemption (CE-200) is for government agencies only. The Board bars using it to show another business, or that company’s insurer, that you are exempt, so a ride company asked by a broker or facility for proof needs a policy certificate or whatever else that customer accepts.

An exemption takes the owner out of coverage. It does not insure anyone else who works for you.

What does the audit add?

The low premium on a ghost policy is an estimate, and the audit sets the real price. Under the standard form, the insurer may examine your books while the policy runs and for three years after the policy period closes. Its premium basis counts the pay of every officer and employee, plus every other person doing work that would expose the insurer to Part One benefits. When you keep no payroll records for those other people, the contract price can stand in, unless you prove their employers lawfully secured coverage. Texas’s amendatory endorsement (WC 42 03 01 F) removes the contract price fallback.

California adds two warnings. An employer that blocks an audit may owe a total premium of three times the estimated premium, and deliberately under-reporting payroll is insurance fraud. Contract drivers who hand you no certificate are the people that wording reaches. The premium audit guide works through that arithmetic, and 1099 or W-2 drivers covers whether those drivers are really independent.

Questions for your agent

Ask four things in writing before you bind a zero-payroll policy:

What is the minimum premium for my class code?
Does the application ask me to state that I have no employees?
How and when do I report my first hire or first contract driver?
Which broker or customer contracts will accept this certificate?

The workers’ comp guide gives the headcount that triggers coverage state by state, and the certificate of insurance entry explains how the proof reaches a broker.

Hours records in HealthRide

HealthRide’s reports include driver timecards and hours, and they export, so the record of who worked and when stays in one place.

Ghost policy: the workers' comp a NEMT owner with no payroll buys, and what the audit adds later