• Certain closely held corporate officers who meet ownership and size criteria and their close relatives, if exclusions are elected properly. • Certain LLC managers and their close relatives, treated similarly to corporate officers. • Certain family farm employment, depending on cash wages and farm liability coverage. • Some casual employees (work not in the usual course of the employer’s business and intended to be one‑time or infrequent). • Certain household workers below quarterly wage thresholds. The statutes and DLI guidance contain detailed definitions, including ownership percentages, payroll‑hour tests, nonprofit and farm rules, and who counts as “immediate family” or “within the third degree of kinship.” Many of these individuals can still be voluntarily covered by endorsement. New for construction and improvement work : • Beginning January 1, 2026 , special rules apply to zero estimated exposure policies for employers providing building construction or improvement services, including written attestations to insurers and written notice (with a copy of the policy) to contracting partners. • Project sponsors and general contractors may also seek approval for certain owner‑ or contractor‑controlled “wrap‑up” programs that meet statutory criteria. Refer MN DLI information, Zero Estimated Exposure and Wrap-up Policies. Elective coverage and independent contractors • Many excluded owners and family members can be included by election ; once coverage is elected, the person is treated as an “employee” for workers’ compensation purposes, and changes must be made in writing to the insurer. • An employer contracting with an independent contractor may also choose to provide coverage; any fee charged to the contractor must be based on a written election, with an endorsement listing covered persons and how the charge is calculated. Penalties for not carrying required coverage Employers that fail to obtain required coverage may face: • Administrative penalties (commonly up to $1,000 per employee per week of noncompliance) and orders barring them from employing people until coverage is secured. • Additional liability to injured workers and exposure to civil suits. • For certain non‑residential construction, repair, or remodeling projects, potential suits by losing bidders, who can seek expected profits, costs, and attorney’s fees if the winning contractor lacked required coverage.
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