What an owner-only or ghost policy means
“Ghost policy” is an informal term, often used for an arrangement where the business has no employees and the owner is excluded. An exclusion means the specified person is left out of benefits under the policy. Such an arrangement should not be treated as protection for that owner’s own work injury.
It may address a proof-of-insurance or licensing requirement, depending on the actual terms. Ask who is insured and who is excluded before choosing a quote. The business entity and ownership affect the available elections.
California licensing can require a policy without employees
CSLB lists active C-8, C-20, C-22, C-39 and C-61/D-49 licensees as requiring workers’ compensation or valid self-insurance even without employees. Other eligible no-employee contractors may qualify for an exemption. A responsible managing employee also affects exemption eligibility.
Use the exact active classifications and personnel on your CSLB record to check the current rule. A certificate filing and a personal coverage election are different documents serving different purposes.
Ask about your own injury protection
If you want coverage for yourself while working, say so at the start. We can review whether owner inclusion is available, what payroll is used for rating and how the policy treats your role. Owner inclusion can change the premium.
Count everyone who helps with the work
Include part-time helpers, temporary workers and family members who work in the business. Paying someone as a subcontractor or on a 1099 does not by itself determine their legal status. Describe the working arrangement so the insurance and employment questions can be addressed.
If you hire employees, arrange required coverage and update payroll estimates before they begin. A previous no-employee exemption does not satisfy the obligation to insure employees who require workers’ compensation.
Keep the insurer informed and the records current
Policies can still require audits or records even when you report no employees. Keep owner election documents, payroll records and subcontractor information. An audit is the insurer’s comparison of the original estimates with what actually happened during the term.
For a review, send the business entity, owners, CSLB record, current policy and description of anyone helping on jobs. We can explain the filing requirement and the owner’s actual coverage as separate decisions.
Common questions
An owner exclusion generally removes that owner from benefits under the policy. If you want your own work injuries included, ask about available owner coverage and its cost before signing an election or purchasing a policy.