Section 3.A vs. Section 3.C Workers’ Compensation: Closing Multi-State Coverage Gaps

For a broader foundation on regional coverage planning, read The Complete Multi-State Commercial Insurance Guide: Coverage, Compliance, and Risk Management for Growing Businesses.

A Connecticut employee travels to New York for a three-week installation. A Massachusetts customer asks your team to work at its facility. One of your employees moves from Hartford to New Jersey and continues working remotely. Your company wins a Rhode Island project that requires repeated site visits.

These situations create the same insurance question:

Does your workers’ compensation policy cover employees working outside the states listed on the policy declarations page?

The answer depends on the policy’s actual wording, the state involved, the employee’s work pattern, and whether the state appears in Item 3.A or is addressed through Item 3.C: Other States Insurance.

This article explains the practical difference between the two sections for businesses operating from Connecticut into New York, Massachusetts, Rhode Island, New Jersey, and other states. It also explains why an “all states” reference or standard endorsement does not automatically solve every compliance problem.

For the broader strategy, review our related article on multi-state workers’ compensation strategy. You can also read our related articles on workers’ compensation payroll audits and E-Mods and the 2027 workers’ compensation outlook and renewal planning.

If your business has employees, offices, or recurring projects in more than one state, request a workers’ compensation policy review before your next employee move, contract, or renewal.Learn more about Insure Connecticut’s commercial insurance resources or request a quote.

Important: This article provides general insurance education, not legal advice. Workers’ compensation is governed by state law. Review your declarations page, endorsements, exclusions, and complete policy forms with a licensed insurance professional. When a specific state’s requirements are uncertain, consult that state’s workers’ compensation authority and qualified counsel.

What do Section 3.A and Section 3.C mean?

Most standard workers’ compensation policies divide state coverage into sections on the policy information page.

Section 3.A: States listed for primary workers’ compensation coverage

Item 3.A identifies the states where the policy provides workers’ compensation coverage under Part One: Workers’ Compensation Insurance.

These are generally the states where the employer has known, ongoing, or established operations when the policy begins. They may include:

• Connecticut headquarters and employees

• A New York branch office

• A Massachusetts warehouse

• A Rhode Island service territory

• A New Jersey employee who works there regularly

• States where the business has recurring projects or a stable workforce

When a state is properly listed in 3.A, the policy is structured to respond to that state’s workers’ compensation law, subject to the complete policy terms and applicable endorsements.

A state should not remain in a “temporary” category simply because the business prefers a simpler policy. If your company has a permanent employee, regular payroll, a physical location, or recurring operations in a state, tell your broker and carrier.

Section 3.C: Other States Insurance

Item 3.C generally addresses states where the employer may begin operations after the policy starts or where exposure is temporary, incidental, or newly developing.

A policy may describe 3.C using language such as:

• “All states except those listed in Item 3.A”

• “Other states insurance”

• Specific states that the carrier agrees to cover

• All eligible states except monopolistic fund states

The exact language controls.

Section 3.C can provide an important backstop when a Connecticut business unexpectedly sends employees into a new state. It can also respond when the employer begins operations in an additional state during the policy period, depending on the policy conditions.

However, 3.C is not a universal guarantee that your company complies with every workers’ compensation law in every state.

The coverage may depend on:

• Whether the state is included in the policy’s 3.C wording

• Whether the insurer is licensed or otherwise authorized to write coverage in that state

• Whether the work is temporary or ongoing

• Whether the employee is based in the state

• Whether the policy requires prompt notice

• Whether the state requires a separate policy or state-specific filing

• Whether the state is a monopolistic fund state

• Whether an endorsement changes the standard form

The practical difference between 3.A and 3.C

Policy section	Typical purpose	Example	Main concern
3.A	Primary coverage for known operating states	A Connecticut company has a permanent New York employee	The state must be correctly listed and supported by the carrier
3.C	Temporary, incidental, or newly developing exposure in another state	A Connecticut employee travels to Massachusetts for a short project	The policy may impose conditions, notice requirements, or exclusions
Separate state policy	Required or preferred state-specific arrangement	Employees work in Ohio, Washington, Wyoming, or North Dakota	Monopolistic state funds generally cannot be replaced by private 3.C coverage

The distinction is not merely administrative. It affects how your policy responds, whether the carrier can issue required evidence of coverage, how payroll is allocated, and whether your business meets the state’s employer obligations.

Why temporary work outside Connecticut can create a coverage problem

Connecticut employers often think of travel as harmless because the employee remains on Connecticut payroll. That assumption can be wrong.

Consider three examples.

Example 1: A temporary New York installation

A Hartford-based electrical contractor sends two Connecticut employees to Buffalo for two weeks. The employees return to Connecticut after the job.

The business should review:

• Whether New York is listed in 3.A or included in 3.C

• Whether the carrier requires notice before work begins

• Whether New York’s rules apply to the employees

• Whether the employees are performing construction work subject to New York requirements

• Whether the contractor needs a New York certificate or policy documentation

• Whether payroll must be allocated to New York for the audit

Short-term work may fit within an Other States arrangement, but the employer should confirm that position before the project begins.

Example 2: A recurring Massachusetts service route

A Connecticut equipment-maintenance company sends technicians to Massachusetts every week. The company has no Massachusetts office, but the work is recurring and generates regular payroll.

This is no longer a simple occasional trip. The employer should ask whether Massachusetts belongs in 3.A or requires another arrangement.

The Massachusetts Department of Industrial Accidents provides information on out-of-state workers’ compensation coverage. The policy review should also consider Massachusetts payroll allocation, employee domicile, customer contract requirements, and the carrier’s authority to write Massachusetts workers’ compensation.

Example 3: A remote employee in New Jersey

A Connecticut technology company allows an employee to relocate permanently to New Jersey. The employee works from a home office and reports to Connecticut management.

The employee’s reporting relationship does not eliminate the New Jersey exposure. The employer must examine where the employee physically performs work and whether New Jersey law applies.

The New Jersey Department of Labor and Workforce Development states that out-of-state employers may need New Jersey workers’ compensation coverage when work is performed in New Jersey or when an employment contract is entered into there.

The company should not assume that an “other states” clause automatically satisfies New Jersey requirements.

How 3.A and 3.C apply in Connecticut, New York, Massachusetts, Rhode Island, and New Jersey

Workers’ compensation is state-based. Each state can apply its own rules to employer coverage, employee status, extraterritorial coverage, claims, forms, notices, and penalties.

Connecticut

Connecticut generally requires employers with one or more employees to carry workers’ compensation coverage unless they qualify for an approved alternative arrangement.

The Connecticut Workers’ Compensation Commission administers the state system. Employers can review the Connecticut Workers’ Compensation Commission’s employer guidance and the Connecticut Workers’ Compensation Act.

Connecticut law can apply to an injury occurring outside the state in certain circumstances, including situations involving an employment contract made in Connecticut. That does not mean every out-of-state exposure is automatically resolved by a Connecticut policy.

For a Connecticut employer, the practical approach is:

• Keep Connecticut in 3.A when Connecticut is the primary operating state.

• Identify employees who regularly work elsewhere.

• Report temporary and recurring out-of-state projects.

• Confirm whether another state should be added to 3.A.

• Check whether the carrier has the required licenses and filings.

• Keep payroll records separated by state and classification.

New York

New York has strict workers’ compensation requirements and can create significant problems for employers that treat New York work as incidental without reviewing the facts.

The New York Workers’ Compensation Board is the primary authority for employer coverage and compliance information.

A Connecticut business with any of the following should conduct a specific New York review:

• New York-based employees

• A New York office, warehouse, or shop

• Regular service work in New York

• Construction or installation projects in New York

• Employees who moved to New York and work remotely

• New York payroll that appears consistently in the company’s records

For ongoing New York exposure, listing New York in 3.A or placing a separate New York policy may be more appropriate than relying solely on 3.C. The carrier must also be able to write coverage that satisfies New York requirements.

Massachusetts

Massachusetts employers generally must provide workers’ compensation coverage for employees, subject to the state’s rules and limited exceptions.

The Massachusetts Workers’ Compensation Act is found in Massachusetts General Laws Chapter 152. The Massachusetts Department of Industrial Accidents provides official guidance and claim information.

A Connecticut company should review its arrangement when it:

• Employs a Massachusetts resident

• Maintains a regular Massachusetts worksite

• Sends employees to Massachusetts on recurring assignments

• Operates a project there for an extended period

• Has Massachusetts payroll that is not tracked separately

Temporary work may fall within 3.C, but the employer must verify the policy language, notice requirements, and Massachusetts treatment of the exposure.

Rhode Island

Rhode Island requires workers’ compensation coverage for most employees, subject to state-specific exemptions and requirements.

The U.S. Department of Labor maintains a directory of state workers’ compensation officials, including resources for Rhode Island employers and employees.

Connecticut companies frequently cross into Rhode Island for construction, healthcare, professional services, manufacturing, logistics, and field-service work. Those employers should map:

• Employee home state

• Worksite location

• Frequency of travel

• Project duration

• Payroll by state

• Employee classification

• Whether the company has a regular Rhode Island operation

When Rhode Island work is recurring, it deserves a formal policy review rather than an assumption that a broad 3.C statement will solve the issue.

New Jersey

New Jersey’s requirements are particularly important for Northeast employers because companies often serve New Jersey customers without maintaining a New Jersey office.

The New Jersey Department of Labor’s employer requirements explain that out-of-state employers may still need New Jersey coverage when work is performed there or when an employment contract is entered into there.

A New Jersey exposure may require further analysis when:

• A New Jersey resident works remotely for the company

• Employees perform regular work in New Jersey

• The employer signs a contract in New Jersey

• The company opens a New Jersey location

• The business hires New Jersey employees

• The company has recurring project payroll in New Jersey

Do not rely on the phrase “all states” without checking the policy and New Jersey requirements.

Why an “all states” policy does not automatically close every gap

The phrase “all states” sounds broad. It is not enough by itself.

An all-states or other-states arrangement may still have important limitations.

The policy may exclude monopolistic fund states

Ohio, Washington, Wyoming, and North Dakota generally operate monopolistic workers’ compensation systems. Employers working in those states typically need to obtain coverage through the applicable state fund or approved state arrangement.

A private policy’s 3.C language does not automatically replace the required state-fund coverage.

The carrier may not be licensed in every state

A carrier that writes workers’ compensation in Connecticut may not be authorized to write it in every other jurisdiction. Ask whether the insurer can legally issue coverage and required certificates in each state where your employees work.

Notice may be required

Some policies require prompt notice when operations begin in a 3.C state. The notice period and consequences vary by policy. Waiting until an injury occurs or a certificate is requested creates avoidable risk.

Regular operations may not fit 3.C

Other States Insurance is commonly designed for temporary, incidental, or newly arising operations. A permanent employee or recurring worksite may require 3.A treatment or a separate policy.

State law can apply even when your policy responds

A policy may provide claim coverage while the employer still faces a state registration issue, certificate problem, penalty exposure, or dispute over whether the state’s benefit law applies.

Coverage and compliance are related, but they are not identical.

What documents should you review?

Before concluding that your workers’ compensation program covers all locations, gather these documents:

A certificate of insurance is evidence of coverage. It is not a substitute for reading the policy.

How multi-state payroll audits expose coverage gaps

Workers’ compensation premium audits compare estimated exposure with actual payroll and operations.

For multi-state employers, the auditor may review:

• Total payroll

• Payroll by state

• Payroll by class code

• Employee job duties

• Worksite records

• Travel and project logs

• Remote employee locations

• Subcontractor payments

• Certificates of workers’ compensation insurance

• Overtime and bonus records

• Federal and state payroll filings

A company that reports all payroll under Connecticut but sends employees to New York, Massachusetts, Rhode Island, and New Jersey may face questions during the audit. The final premium may change, and the audit may reveal that the policy’s state structure does not match actual operations.

Maintain records that show:

• Where each employee worked

• How much time each employee spent in each state

• What duties the employee performed

• Which classification code applied

• Whether the assignment was temporary or ongoing

• When the employee started working in that state

The workers’ compensation audit guide from Insure Connecticut explains why payroll, class codes, subcontractors, and loss history affect the final premium.

A practical review checklist for employers

Use this checklist before hiring, relocating, or sending employees across state lines.

Step 1: Build a state-by-state employee map

List every state where employees:

• Live and work remotely

• Report to an office

• Perform field service

• Work on customer projects

• Operate vehicles

• Attend recurring job sites

• Receive payroll

Step 2: Separate temporary and regular exposure

Mark each state as:

• Home state

• Permanent work location

• Recurring project state

• Occasional travel state

• Newly planned expansion state

This classification helps your broker determine whether the state belongs in 3.A, may be addressed through 3.C, or requires a separate policy.

Step 3: Review the actual policy forms

Do not rely on memory or a verbal description. Review Item 3.A, Item 3.C, and all endorsements.

Step 4: Notify the carrier early

Tell your broker before:

• Hiring an employee in another state

• Allowing a permanent remote move

• Opening an office or warehouse

• Starting a recurring project

• Signing a state-specific contract

• Expanding into a monopolistic fund state

Step 5: Prepare payroll records

Track payroll by state and classification from the first day of the assignment. Do not wait until the annual audit.

Step 6: Revisit the policy at renewal

A renewal is the right time to compare:

• Current state list

• Employee locations

• Payroll allocations

• Carrier licenses

• State-specific endorsements

• Loss runs

• Experience modification rate

• Claims handling

• Premium and deductible structure

When should you involve a specialized commercial broker?

A straightforward Connecticut employer with no out-of-state operations may have a relatively simple workers’ compensation placement.

The review becomes more complex when the business has:

• Employees in five or more states

• Remote workers across state lines

• Construction or installation crews

• Transportation or delivery operations

• Temporary staffing arrangements

• Multiple legal entities

• Shared employees between subsidiaries

• Regular work in New York or New Jersey

• High payroll or significant claims history

• Operations in monopolistic fund states

• Excess-and-surplus or specialty insurance needs

Insure Connecticut LLC helps businesses compare commercial coverage across multiple states. For complex multi-state commercial placements, specialty risks, larger accounts, or structures that require broader market access, Icon Insurance Solutions may be an appropriate referral resource.

That referral does not replace a review of the actual forms. It provides another path when the account requires more specialized placement capability.

Frequently asked questions

Is Section 3.C the same as all-states workers’ compensation coverage?

No. Section 3.C generally provides Other States Insurance, but its scope depends on the policy wording, endorsements, state law, carrier authority, and the nature of the work. Some policies use broad “all states except” language. Others restrict the states or circumstances covered.

Should every state where my employees work be listed in 3.A?

Not automatically. Known, ongoing, or regular operations usually deserve 3.A consideration. Temporary or incidental exposures may fit within 3.C. Your broker and carrier must review the facts, policy wording, and state requirements.

Can a Connecticut workers’ compensation policy cover an employee temporarily working in New York?

It may, depending on the policy and New York requirements. Confirm whether New York is listed, included under 3.C, and supported by a carrier authorized to write New York coverage. Do not assume that temporary work automatically creates coverage.

Does a remote employee create workers’ compensation exposure in another state?

Yes. A remote employee generally works where the employee physically performs the job. If a Connecticut employee permanently relocates to New Jersey, Massachusetts, New York, or another state, notify your broker before the move.

Does 3.C cover Ohio, Washington, Wyoming, or North Dakota?

A standard private-market 3.C provision generally does not replace coverage required through a monopolistic state fund. Employers entering those states should review the applicable state-fund requirements separately.

Does a certificate of insurance prove that the policy covers every state?

No. A certificate summarizes insurance information. It does not amend the policy or override exclusions and conditions. Review the declarations page, endorsements, and forms.

How does multi-state payroll affect workers’ compensation audits?

Auditors compare actual payroll and work locations with the information used to calculate the estimated premium. Incomplete state and classification records can lead to additional premium, disputes, or policy corrections.

Where can I learn the basic definition of workers’ compensation?

The Wikipedia overview of workers’ compensation provides a general definition. It is a starting point, not a substitute for state law or policy review.

Are online discussions reliable for coverage decisions?

Online discussions can show the questions other business owners ask, but they are not authoritative. For example, small-business discussions about workers’ compensation may provide practical context, but your decision should rely on your policy, carrier, licensed broker, state authorities, and counsel when necessary.

Is there a video explanation of 3.A and 3.C?

General educational videos, such as this workers’ compensation coverage explainer on YouTube, can help you understand the terminology. Always compare any general explanation with your actual policy forms.

The bottom line for Northeast employers

Section 3.A and Section 3.C serve different purposes.

• 3.A is generally used for known and ongoing states of operation.

• 3.C generally addresses temporary, incidental, or newly developing operations.

• Neither section should be treated as a blanket promise of compliance in every state.

• New York, Massachusetts, Rhode Island, and New Jersey each require state-specific review.

• Ohio, Washington, Wyoming, and North Dakota may require separate state-fund coverage.

• Remote employees and recurring travel can change your workers’ compensation obligations.

• Your actual policy forms control.

If your company operates from Connecticut into New York, Massachusetts, Rhode Island, New Jersey, or beyond, review your policy before the next employee move or project begins.

Request a multi-state workers’ compensation review from Insure Connecticut LLC. We can help you compare your state footprint, payroll records, policy forms, and renewal strategy with the coverage your business actually needs.Request a commercial insurance quote or learn more about Connecticut small business insurance.