Most Tennessee employers that need workers’ compensation insurance carry it. When one does not, the state has a backstop with a hard ceiling. Tennessee’s Uninsured Employers Fund (UEF), run by the Bureau of Workers’ Compensation, can pay an eligible injured worker up to $40,000 in total benefits. The employer, meanwhile, can be assessed a penalty of 1.5 times its total estimated annual premium.
| Item | What the Bureau and its rules say |
|---|---|
| Who must carry coverage | Construction businesses generally must cover everyone, including owners; other businesses need coverage with five or more employees |
| Employer penalty | 1.5 times estimated annual premium; up to three times for multiple violations in five years |
| Worker eligibility | Injury on or after July 1, 2015; Tennessee resident; notice within 180 days; judgment against the employer (with listed exceptions) |
| Temporary disability benefits | Up to $20,000 |
| Medical benefits | Up to $20,000 |
| Maximum total | $40,000 |
Sources: Tennessee Bureau of Workers’ Compensation and Tenn. Comp. R. & Regs. 0800-02-30.
Who has to carry workers’ comp in Tennessee
The Bureau says businesses in the construction industry generally must have coverage for everyone, including the business owners. Other businesses need insurance if they have five or more employees. The UEF page adds that businesses that illegally skip coverage, or illegally misclassify employees as “independent contractors” or “subcontractors,” are subject to financial penalties. Those fines are collected by the state and used to pay benefits to eligible workers hurt while working for an illegally uninsured employer.
What uninsured employers face
The Bureau’s compliance page says penalties start at 1.5 times the avoided premium and could increase to three times the avoided premium for multiple violations over a five-year period. The Bureau offers every entity receiving an assessment an interest-free payment plan. Paying a penalty still leaves the business without the protection a policy provides. If the standard market will not write you, see TDCI explains how Tennessee employers buy workers’ comp and reach the residual market.
What an injured worker needs to qualify
Under Rule 0800-02-30-.03, the worker must have been hurt on or after July 1, 2015, primarily in the course and scope of employment while the employer was uninsured, and must have been a Tennessee resident on the date of injury. The worker must notify the Bureau of the injury and the employer’s lack of coverage within 180 days, and, except as the statute provides, must secure a workers’ compensation judgment against the employer.
What the fund can pay
Rule 0800-02-30-.04 allows temporary disability benefits up to $20,000 and medical benefits up to $20,000, including a medical causation evaluation, mileage reimbursement, and attorney’s fees if applicable. The maximum for all benefits is $40,000. If one category uses less than $20,000, the remainder may be applied to the other category on written request. For comparison, see the weekly benefit rates that apply to insured claims: Tennessee raised its workers’ comp weekly benefit caps for injuries on or after July 1, 2026.
Contractors: check your subs
- The Bureau says you can search an employer’s coverage on NCCI’s Coverage Verification website and sign up for email alerts if that employer cancels coverage early. Step-by-step: TDCI’s workers’ comp page says verify coverage online — a certificate may not warn you of cancellation.
- Keep current certificates of insurance on file for every subcontractor before work starts.
- To report an employer, the Bureau says to submit a Request for Investigation to [email protected] or call 800-332-2667.
- Workers who think they may qualify can contact the UEF Claims Manager at 901-543-0042.
- Loss costs for insured employers: TDCI says Tennessee workers’ comp premiums decline for a 13th consecutive year. Statewide injury trends: Knox County accounted for 7.1% of Tennessee’s 2025 workers’ comp injury reports, the state’s annual report shows.
This article is informational only and is not legal advice. It does not promise coverage, eligibility, fund benefits, or a premium. Your policy and Tennessee law control.
Related reading from All Seasons
- TDCI’s workers’ comp page says verify coverage online — a certificate may not warn you of cancellation.
- TDCI explains how Tennessee employers buy workers’ comp and reach the residual market.
- Tennessee raised its workers’ comp weekly benefit caps for injuries on or after July 1, 2026.
- TDCI says Tennessee workers’ comp premiums decline for a 13th consecutive year.
- Knox County accounted for 7.1% of Tennessee’s 2025 workers’ comp injury reports, the state’s annual report shows.
Free policy review
All Seasons Insurance Group offers a free personal policy review. Call 865-263-1400 or visit asigtn.com/get-a-quote/. This article is informational only and does not promise coverage or eligibility; your policy forms control. Seasons change. So should your coverage.
What is Tennessee’s Uninsured Employers Fund?
It is a Bureau of Workers’ Compensation program funded by penalties on illegally uninsured employers. It may pay benefits to an eligible worker injured while working for an illegally uninsured employer.
How much can the fund pay?
Rule 0800-02-30-.04 allows temporary disability benefits up to $20,000 and medical benefits up to $20,000, with a maximum of $40,000 for all benefits.
Who qualifies for the fund?
The rules require an injury on or after July 1, 2015, while the employer was uninsured; Tennessee residency on the date of injury; notice to the Bureau within 180 days; and, with listed exceptions, a judgment against the employer.
Which Tennessee businesses must carry workers’ comp?
The Bureau says construction businesses generally must cover everyone, including owners. Other businesses need insurance if there are five or more employees.
What is the penalty for not carrying workers’ comp?
The Bureau says a business may be assessed 1.5 times its total estimated annual premium, and penalties could increase to three times the avoided premium for multiple violations over five years.
How do I report an uninsured employer?
The Bureau says to submit a Request for Investigation to [email protected] or call 800-332-2667 and ask for the UEF Program.
How can I confirm a subcontractor has coverage?
The Bureau points to NCCI’s Coverage Verification website, which also offers email notifications if an employer cancels coverage early.
How can All Seasons help after reading this?
Call 865-263-1400 or visit asigtn.com/get-a-quote/ for a free personal policy review. Informational only; no coverage promises. Seasons change. So should your coverage.
Source links
- Tennessee Bureau of Workers' Compensation: Uninsured Employers Fund
- Tennessee Bureau of Workers' Compensation: Compliance
- Tennessee Bureau of Workers' Compensation: Who Must Carry Insurance
- Tenn. Comp. R. & Regs. 0800-02-30-.03 General Requirements (LII)
- Tenn. Comp. R. & Regs. 0800-02-30-.04 Available Benefits (LII)
- Get a Quote — All Seasons Insurance Group
