What kind of insurance coverage is required for workers' compensation in Hawaii?

In Hawaii, businesses are required to provide workers' compensation insurance coverage to their employees, which can be achieved through licensed insurance carriers or via self-insurance. This requirement ensures that employees who sustain work-related injuries or illnesses receive appropriate medical care and wage replacement benefits.

Choosing coverage through licensed insurance carriers helps businesses transfer the risks associated with workers' compensation claims to insurance companies, providing financial protection against the costs of claims. On the other hand, self-insurance allows companies that meet certain financial criteria to take on the responsibility of handling their own claims, effectively managing the risk in-house.

This approach reflects a balance that accommodates different business structures and sizes, allowing flexibility while still maintaining a commitment to employee safety and support. The other options do not adequately capture the comprehensive coverage required or misrepresent the conditions under which businesses can operate without insurance. For example, there is no blanket exemption based on the size of the business, and government-provided insurance coverage does not exist as a standard option in Hawaii's workers' compensation system.