Crossing Into Washington Could Change the Rules of Your Insurance

For interstate trucking companies, crossing state lines is part of everyday business. But Workers’ Compensation rules do not necessarily travel with the truck automatically.

Washington has specific requirements for out-of-state employers whose workers enter the state. And there is one particularly important point for the trucking industry: an out-of-state employer must provide Workers’ Compensation coverage for workers entering Washington even if the employer’s home state does not require that coverage.

Interstate Trucking: Washington Has Its Own Rules

The Washington State Department of Labor & Industries (L&I) states that companies operating exclusively as interstate carriers must have Workers’ Compensation coverage through Washington or another state and maintain documentation showing where their workers are insured.

For an employer based outside Washington, there are generally several ways to satisfy the requirement. A company may cover its drivers through Washington’s industrial insurance system, qualify as a certified self-insured employer, or use Workers’ Compensation coverage from another state that effectively protects the driver while working in Washington and meets applicable L&I requirements.

This means having a policy in the company’s home state should not automatically be interpreted as having the Washington exposure covered.

Not Every State Is Treated the Same Way

Washington maintains reciprocal agreements with Idaho, Montana, Nevada, North Dakota, Oregon, South Dakota, Utah, and Wyoming. These agreements may allow certain employees to work temporarily in Washington without requiring the employer to purchase separate L&I coverage.

But employers should not simply assume reciprocity applies.

L&I says employers should verify that their insurer will provide coverage while the employee is temporarily working in Washington and obtain the appropriate Extraterritorial Coverage Certificate. Once approved, L&I confirmation provides evidence that the out-of-state coverage has been accepted.

For workers coming from states that do not have reciprocal agreements with Washington, the situation may require an individual assessment. Washington considers factors such as the type of work being performed, the states where the employee normally works, how much time and how frequently the employee works in Washington, where the worker was hired, and what Workers’ Compensation coverage is provided by the out-of-state insurer.

The Real Problem May Appear After an Accident

This is where the risk becomes more serious.

Imagine a driver employed by a company based outside Washington is injured while working in the state.

If that employee is properly protected by valid out-of-state coverage, the claim may fall under that insurer. But L&I identifies a much more complicated scenario: if the out-of-state insurer denies the claim because the injury occurred in Washington, or if the policy has expired, the employer may be out of compliance with Washington requirements.

The consequences can include unpaid premiums, penalties, interest, and costs associated with the claim.

For an interstate trucking company, therefore, the important question is not simply:

“Do I have Workers’ Compensation?”

It should also ask:

“Does my coverage protect my drivers when they enter Washington?”

Records Matter Too

Washington also establishes specific recordkeeping obligations for interstate trucking companies.

According to L&I, businesses must maintain original books and time records, including supporting information from driver logs, for three calendar years plus three months. Quarterly reporting requirements may also apply.

Documentation is therefore another important part of compliance. Having coverage is one thing; being able to demonstrate that coverage is another.

What If the Driver Is a 1099 Contractor?

This is another area where trucking companies should be particularly careful.

In Washington, giving a worker a 1099 form does not automatically make that person an independent contractor who is exempt from Workers’ Compensation requirements.

L&I specifically explains that receiving a 1099 does not, by itself, determine whether Workers’ Compensation coverage is required. The legal requirements governing independent contractors must still be evaluated.

For trucking companies using different driver employment and contracting models, proper worker classification can be just as important as the insurance policy itself.

Before the Next Truck Enters Washington

Interstate transportation can make state borders feel almost invisible. For insurance and regulatory compliance, they are not.

A trucking company regularly operating into Seattle, Tacoma, Spokane, or anywhere else in Washington should review where its drivers are based, what type of operation they perform, which Workers’ Compensation coverage protects them, and whether that coverage is recognized while they are working in Washington.

Reviewing these issues before the trip can help prevent a company from discovering a coverage gap only after an accident occurs.

Official Sources

• Washington State Department of Labor & Industries — Trucking
• Washington State Department of Labor & Industries — Out-of-State Employers and Out-of-State Workers
• Washington State Department of Labor & Industries — Independent Contractors, Gig and Remote Work
• Washington State Department of Labor & Industries — Injured Outside Washington