Workers’ Comp Gaps for 1099 Techs:
Why You Could Be on the Hook

“They’re 1099, so I’m not responsible for them… right?”

That’s what a lot of contractors think—right before they get hit with a workers’ comp claim they never saw coming.

If you’re using subcontractors or 1099 techs to handle overflow work or special projects, you might assume they handle their own insurance. But if someone gets hurt on the job, the state (and possibly the judge) might see things very differently.

Let’s dig into why relying on “they’re not my employee” isn’t enough to protect your business.

If your 1099 tech:

• Works only for you,
• Wears your company shirt,
• Drives your van,
• Follows your schedule and pricing…

…guess what? The state might decide they’re actually an employee, no matter what the paperwork says.

And if they get injured on the job and don’t have their own workers’ comp? You might be held responsible for their medical bills, lost wages, and more.

Let’s dig into why relying on “they’re not my employee” isn’t enough to protect your business.

Short answer: It’s bad.

• Fines from the state (some in the five-figure range)
• Liability for medical expenses
• Lawsuits from injured workers
• Potential stop-work orders or business license issues
• A very cranky insurance auditor

And if you didn’t count those 1099 workers on your workers’ comp policy? Expect a surprise bill at audit time.

1. Ask for a Certificate of Insurance

Every 1099 worker should have their own:

• Workers’ comp policy
• General liability coverage
• Commercial auto (if driving for you)

No policy = no job. Period.

 

2. Put It in Writing

Use a subcontractor agreement that outlines:

• Their independent status
• Proof of insurance requirement
• That they are responsible for their own employees, if any

 

3. Keep Good Records

If you ever get audited (and you will), you’ll need to prove:

• Who was on your payroll
• Who was truly a 1099
• Who had their own insurance

Photos, invoices, contracts, and job logs are your best friends here.

 

4. Talk to Your Agent

Make sure your workers’ comp policy is structured correctly for how your team actually operates. Don’t assume—you know what they say about that.

1099 doesn’t mean “no responsibility.” It just means “please double-check your insurance before this goes south.”

If you’re using independent contractors to grow your HVAC or plumbing business, make sure you’re not unknowingly taking on all of their risk, too.