Frequently Asked Questions

Below are common questions about Chesapeake Employers and workers' compensation insurance that many agents ask.

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Q: What type of application does Chesapeake Employers accept?

A: Chesapeake Employers accepts the ACORD 130 application.  The most current version of the application should be submitted. 

A cover letter explaining the submission is also helpful. Completed applications may be sent to Chesapeake Employers by fax (410-494-2480), email (, or mail (Chesapeake Employers’ Insurance Company, 8722 Loch Raven Blvd., Towson, MD 21286).  Note: Applications should be typed, as Chesapeake Employers discourages handwritten forms.

Coverage & Benefits

Q: What is workers' compensation insurance?

A:  Maryland’s workers’ compensation law requires most employers to provide benefits to eligible employees who sustain injuries arising out of and in the course of employment.  A workers’ compensation insurance policy provides protection against liability arising under Maryland’s workers’ compensation law.

Q: Who is covered?

A:  Corporations:  All employees are covered.  Corporate officers who meet the criteria of Section 9-206 of the Labor and Employment Article are coveredCorporate officers can file a formal election to be excluded from coverage.  Partnerships:  All employees are covered.  Partners are not covered but can formally elect to be covered.  Sole Proprietors:  All employees are covered.  The sole proprietor (owner) is not covered but can formally elect to be covered.   Inclusion and exclusion forms can be found at

Q: What types of benefits are provided?

A:  Medical benefits, disability benefits, subsequent injury fund benefits, vocational rehabilitation benefits, and death benefits.

Q: Do farmers need workers' compensation insurance?

A:  Please see Section 9-210 of the Labor and Employment Article for information on the requirements for farmers.

Q: In what states does Chesapeake Employers provide coverage?

A:  Chesapeake Employers provides workers’ compensation coverage for all Maryland exposures. Chesapeake Employers can consider coverage for other states exposures.

Coverage for a Maryland-based company with some employees working for extended periods of time or permanently located in another state may require an Other States Coverage policy through Chesapeake Employers.

For your clients’ coverage needs in these situations, Chesapeake Employers has teamed with Zurich North America to provide an insurance solution in all U.S. states except North Dakota, Ohio, Washington, Wyoming, U.S. Virgin Islands and Puerto Rico.

Contact your Chesapeake Employers underwriter or territorial account executive to learn how Chesapeake Employers builds the bridges necessary to keep all your Maryland-based business clients covered.

Q: What limits are provided for employers' liability?

A: Standard employers’ liability limits provided in policies issued by Chesapeake Employers are:

  • $100,000 bodily injury by accident each accident

  • $500,000 bodily injury by disease policy limit

  • $100,000 bodily injury by disease each employee

     Limits may be increased to $500,000 or $1,000,000 upon request, for an additional premium.

Premium Calculation

Q: How is premium determined?

A: All businesses are assigned a classification(s) based upon the nature of their operations. Chesapeake Employers has developed premium rates (per $100 of gross payroll) for each classification. These rates reflect the hazards of the particular employment.

Premium is determined by multiplying the rate for a business classification by the amount of payroll assigned to that classification. If your client has several classifications, the premium is the sum of the premium for all classifications.

Q: What is an experience rating?

A: Experience rating or experience modification is a factor developed from reported payrolls and losses incurred during prior policy terms. An experience rating factor of less than 1.00 will help decrease premium, while an experience factor greater than 1.00 will increase premium. This factor may be developed by Chesapeake Employers or NCCI, depending on where coverage was provided in prior years. Policies in force for 2 years or longer with total cumulative premium of $3,000 or greater over the rating period may be eligible for a Chesapeake Employers' experience rating. Chesapeake Employers will apply the NCCI experience rating factor for new business, if one exists. Please contact NCCI for its experience rating eligibility for Maryland.

Q: What are the payroll limitations for a sole proprietor, partner or corporate officer?

A: Please refer to the Chesapeake Employers' Producer’s Guide (available through the Agent eServices portal) for all payroll limitations.

Q: Does Chesapeake Employers offer installment pay plans for premium?

A: Yes. A number of installment plans are available, depending on the premium size and payment history. A $7 per installment payment fee will be applied. There is no installment fee for a single, annual pay plan.

Q: Does Chesapeake Employers accept credit card payments?

A: Yes, Chesapeake Employers accepts VISA, MasterCard and the Discover card.

Premium Audit

(For additional Premium Audit Process FAQs - Click here)
Q: When are premiums charged for subcontractors?

A:  Pursuant to Maryland’s workers’ compensation law, the principal contractor is liable for injuries to an uninsured subcontractor and the employees of the subcontractor.  Premiums will be charged if a Certificate of Insurance showing proof of workers’ compensation coverage for the period worked is not provided.

Q: What is the “Sole Proprietor’s Status as a Covered Employee” form?
 (Rev. Feb. 2015)

A: The Sole Proprietor’s Status as a Covered Employee form is provided by the Maryland Workers’ Compensation Commission (WCC). This form allows an independent contractor operating as a sole proprietor to make a selection as to whether he/she wants to be covered under the Maryland Workers’ Compensation law. Chesapeake Employers reserves the right to assess premium at audit for any independent contractor(s) not properly excluded from coverage by this form.

Q: What is included in payroll?

A:  Payroll includes all of the following:

  • Wages or salaries, total cash for commissions and draws against commission

  • Bonuses, including stock bonus plans

  • Extra pay for overtime work, pay for holidays, vacation, and sick time

  • Payment for piecework

  • Profit sharing,

  • Rental values of an apartment or house provided to an employee based on comparable accommodations

  • Value of lodging, other than an apartment or house received by an employee as part of his/her pay

  • Value of meals received as part of pay

  • Value of store certificates, merchandise, credits, or any other substitute for money received by employees as part of this pay

  • Authorized salary reductions from employees’ gross pay (i.e., cafeteria plans, retirement plans, etc.)

  • Annuity plans

  • Expense reimbursement

  • Davis-Bacon wages or wages from a similar prevailing plan

Q: What records may be needed for a premium audit?

A:  The following records may be requested in order to perform a premium audit:

  • Payroll records

  • Payroll breakdowns

    • By classification

    • By state

    • Overtime

  • Individual earnings cards/reports

  • 941’s and Form 940

  • W-2’s and W-3 forms

  • Profit and loss statement

  • Cash disbursements

  • Certified payrolls on OCIP/CCIP jobs

  • Sales journal/cash receipts

  • Certificates of Insurance for subcontractors

  • List of clerical employees and job duties

  • 1099s and Form 1096

  • Job cost records, contracts and invoices

  • General ledger and check register

  • Federal income tax return

  • Maryland quarterly unemployment reports

  • A description of the business operations

  • A list of locations

  • A list of officers and their duties


Q: What are the different types of workers' compensation fraud?

A:  Chesapeake Employers has a fully staffed Special Investigations Unit that investigates fraud, including claimant fraud, premium avoidance fraud, and medical care provider fraud.

Chesapeake Employers has a zero tolerance policy toward fraud.  If you would like to report possible fraud, call us at 1-800-268-4372.

Q: What is the Maryland Workers' Compensation Commission?

A:  The Maryland Workers’ Compensation Commission is the regulatory agency that adjudicates all issues under the jurisdiction of the Maryland workers’ compensation law.  The Commission will decide:

  • Initial entitlement to compensation benefits

  • The necessity and reasonableness of medical treatment

  • The amount of lost wages to be awarded as a result of the injury

  • The entitlement to vocational rehabilitation

  • The entitlement to permanent disability benefits

Q: What is a third-party administrator?

A:  A third-party administrator will provide risk management, loss control, and claims-handling services to non-policyholders, usually self-insured businesses.

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