FAQ: Nonelection of Workers' Compensation or Employers' Liability Coverage Under Iowa Code Section 87.22

Overview

A proprietor, limited liability company member, limited liability partner, or partner may elect not to be covered by workers' compensation or employers' liability coverage under by Iowa Code chapters 85, 85A, and 85B relating to workers’ compensation by knowingly and voluntarily making a nonelection of workers' compensation or employers' liability insurance coverage (nonelection of coverage).

This page has information about nonelections of coverage. 

For more resources relating to nonelections of coverage, click here.

Iowa Workers' Compensation Law

Nothing on this page supersedes the Iowa Code, Iowa Administrative Code (IAC), orders and decisions of the Iowa Workers' Compensation Commissioner, or decisions of Iowa courts. For more information about Iowa workers' compensation law, click here.

Frequently Asked Questions (FAQ) 

Employees of what types of entities may Make a nonelection of coverage?

A proprietor, limited liability company member, limited liability partner, or partner may make a nonelection of coverage. Therefore, only the following types of entities may make a nonelection of coverage:

  • Proprietorship
  • Limited liability company (LLC)
  • Limited liability partnership (LLP)
  • Partnership

Employees of no other type of entity may reject coverage.

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which individuals may reject coverage? 

Only the following individuals may reject coverage:

  • Proprietor
  • Limited liability company member
  • Limited liability partner
  • Partner

No other types of employees may make a nonelection of coverage under the law.

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 What is a nonelection of coverage? 

It means that the individual making the nonelection of coverage is not covered by Iowa Code chapters 85, 85A, and 85B relating to workers’ compensation and employers’ liability coverage for bodily injuries or death sustained by the employee arising out of and in the course of the officer’s employment.

It is not a waiver of any rights or remedies available to the employee or others on the employee’s behalf in a civil action related to personal injuries sustained by the employee’s arising out of and in the course of the officer’s employment.

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If the employer has a workers' compensation or employers' liability insurance policy, how does an individual make a nonelection coverage? 

If the employer has been issued a workers’ compensation or employers’ liability policy, a proprietor, limited liability company member, limited liability partner, or partner may make a nonelection of coverage by signing and attaching to the liability policy a written nonelection of coverage.

If you have questions about making a nonelection of coverage by attaching a written rejection to the employer's workers' compensation or employers' liability policy, you should contact your attorney and/or your insurance carrier. For information about legal advice and referrals, click here.

You do not file a nonelection of coverage with DWC if the employer has a workers' compensation or employers' liability policy.

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If the employer does not have a workers' compensation or employers' liability insurance policy, how does an individual make a nonelection of coverage?

If the employer does not have a workers’ compensation or employers’ liability policy, then a proprietor, limited liability company member, limited liability partner, or partner may make a nonelection of coverage by completing, signing, and filing the online nonelection of coverage form with DWC.

The signing of the nonelection of coverage form must be witnessed by two disinterested witnesses.

To view, complete, sign, and file the DWC nonelection of coverage form, click here.

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Who may serve as a witness to the signing of a nonelection of coverage form filed with DWC?

Any two disinterested individuals who are not, formally or informally, affiliated with the employer.

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When is a nonelection of coverage unenforceable?

A nonelection of coverage is unenforceable when it is required as a condition of the proprietor, limited liability company member, limited liability partner, or partner's employment.

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Can an individual terminate a nonelection of coverage that was filed with DWC?

Yes, a proprietor, limited liability company member, limited liability partner, or partner may terminate a nonelection of coverage filed with DWC.

For more information about terminating a nonelection of coverage filed with DWC, click here.

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Is a Nonelection of coverage filed with DWC a public record? 

Yes, a nonelection of coverage is a public record. DWC is required by law to keep a public list of nonelections of coverage filed with the agency.

To view the online list of rejections of coverage filed with DWC, click here.

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What is the difference between a nonelection of coverage and a rejection of coverage?

Whether an employee is eligible under the law to make a nonelection of coverage or a rejection of coverage depends on the type of business entity and type of employee.

Noneleection of Coverage

A proprietor, limited liability company member, limited liability partner, or partner may make a nonelection of workers' compensation or employers' liability coverage (nonelection of coverage).

No other type of employee may make a nonelection of coverage.

Rejection of Coverage

Up to four corporate officers of the president, vice president, secretary, and treasurer of a corporation (but not a family farm corporation) may make a rejection of coverage.

No other type of employee for any other type of business entity may make a rejection of coverage.

For more information about rejections of coverage, click here.

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HYpotheticals

The following are hypotheticals intended to illustrate common scenarios relating to nonelections of coverage under Iowa Code section 87.22.

Because a proprietor, limited liability company member, limited liability partner, or partner may all make a nonelection of coverage, the hypotheticals apply to each and all of them.

No. 1

Riley is the proprietor of a business. The business does not have a workers' compensation or employers' liability insurance policy. Riley wants to make a nonelection of coverage.

To make a nonelection of coverage, Riley must:

  1. Go to the DWC website and complete the online nonelection of coverage form.
  2. Two disinterested witnesses, who have no formal or informal affiliation with the employer, must watch Riley electronically sign the online form.
  3. An authorized representative of the employer must also complete the online nonelection of coverage form. (Because Riley is a proprietor, Riley may be an authorized representative of the employer.)
  4. Two disinterested witnesses, who have no formal or informal affiliation with the employer, must watch the authorized representative sign the online form.

After the filing of the online nonelection of coverage form with DWC:

  • Riley and the authorized representative of the employer (if someone other than Riley) will receive a verification email with the information provided on the form.
  • The online DWC list of nonelections of coverage will show Riley's nonelection of coverage.

No. 2

Peyton is a member of a limited liability company. The company has a workers' compensation or employers' liability insurance policy. Peyton wants to make a nonelection of coverage. Peyton has questions about how to make a nonelection of coverage.

Because the company has a workers' compensation or employers' liability insurance policy, Peyton:

  • Does not file a nonelection of coverage with DWC. 
  • Should not contact DWC with questions because DWC cannot give legal advice or make referrals to attorneys. For information about legal advice and referrals, click here.
  • Should contact an attorney or the insurance carrier with his questions about how to make a nonelection of coverage.

No. 3

Jordan is a limited liability partner. The business does not have a workers' compensation or employers' liability policy. Jordan would like to make a nonelection of coverage.

Jordan has completed the online nonelection of coverage form. Jordan needs two witnesses to the signing of the form.

One of the crews of subcontractors that contracts with the company for work is at the office. Jordan cannot have any of the members of the crew of subcontractors be a witness because they have a financial relationship with the company. They do not qualify as disinterested individuals without a formal or informal affiliation with the company.

No. 4

Sawyer is the president of a corporation. Sawyer's business has no other employees. Sawyer's business does not have a workers' compensation or employers' liability insurance policy.

Sawyer's insurance carrier advises Sawyer to take out a workers' compensation or employers' liability insurance policy in case a work injury occurs. Sawyer does not want to pay for such a policy. Sawyer's friend is a partner in a business, who tells Sawyer that the partners in the business made nonelections of coverage. The friend suggests that Sawyer make a nonelection of coverage. 

Sawyer cannot make a nonelection of coverage because Sawyer is not a proprietor, limited liability company member, limited liability partner, or partner. Because Sawyer is the president of a corporation, Sawyer may make a rejection of coverage.

For information about rejections of coverage, click here.

No. 5

Blake is a member of a limited liability company. The majority owner of the company tells Blake to make a nonelection of coverage or be fired. Blake makes a nonelection of coverage because the majority owner made it a requirement of employment.

The nonelection of coverage that Blake made is not enforceable because the company required it as a condition of employment.

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