An Illinois partnership must carry workers' comp as soon as it has any non-partner employee, full-time or part-time (820 ILCS 305/3). The partners themselves are not employees of the partnership and are outside the Act by default, though they may elect to be covered by having the carrier add them (820 ILCS 305/1(b)). So two partners working alone usually are not required to carry, and hiring is what triggers the duty.
Who this is for: Illinois general and limited partnerships, with or without non-partner staff.
The short version
- A partnership with any employee must carry coverage from that first hire.
- Partners are not employees of the partnership and are out of the Act by default.
- A partner may elect to be covered by having the carrier add them to the policy.
- Non-partner employees are always covered and cannot be excluded.
- Partners are personally liable if the partnership skips required coverage.
How Illinois treats working partners
Unlike a corporate officer or an LLC member, a partner is not on the policy by default. The Act treats partners like sole proprietors: they may elect to be covered, which means they start outside the Act and choose to come in. That is a real difference from some neighboring states that count working partners as employees, so do not carry another state's rule into Illinois. The partnership must still insure its non-partner employees from the first hire, and those employees cannot be left off no matter how the partners handle their own coverage.
What applies to your partnership
| Your partnership setup | Is comp required? | What partners and staff should know |
|---|---|---|
| Two partners, no other staff | Usually no | Partners are not employees of the partnership; a policy is not forced, but they may elect in |
| Any partnership with an employee | Yes | The employee must be covered from the first hire; partners are out unless they elect in |
| Partners who want their own injuries paid | Elect in | Add each partner to the policy by endorsement so their on-the-job injuries are covered |
| Partnership using uninsured subs | Exposed either way | You can be liable for an uninsured sub's injured workers (820 ILCS 305/1(a)(3)) |
Electing a partner in
Because partners are outside the Act by default, a partner who wants their own injuries covered has to elect in, which is done by having the carrier add them to the policy. You can bring some partners in and leave others out, and your employees stay covered regardless. One caution worth remembering: partners carry personal liability, so if the partnership was required to insure its employees and did not, the partners can be personally on the hook for the claim and the penalties, which in Illinois can include felony exposure and a civil penalty with a 10,000 dollar minimum.
A Joliet example
Illustrative, not a quote. A Joliet plumbing partnership is run by two partners who both work in the field, plus one apprentice on payroll. Because there is an employee, Illinois requires a policy, and the apprentice must be covered. The two partners are outside the Act by default, but they decide to elect themselves in so their own on-the-job injuries are paid. We place the policy, rate the plumbing payroll correctly, and produce certificates the same day when a general contractor asks for proof. See our workers comp for plumbers page.
Real questions Illinois owners ask
Do partners count as employees for Illinois workers comp?
No. Partners are not employees of the partnership and are outside the Act by default, so they are not automatically counted. They may elect to be covered if they want.
Does a two-partner firm with no employees need coverage?
Usually not. Two partners working alone are not employees of the partnership, so a policy is not forced, though they may elect coverage on themselves.
When does our partnership have to carry coverage?
Once you have any employee. The moment the partnership hires a non-partner worker, full-time or part-time, coverage is required for that employee from the first hire.
Can a partner get their own injuries covered?
Yes, by electing in. A partner can be added to the policy by endorsement so their on-the-job injuries are paid, even though the Act does not require it.
Are our employees covered if the partners stay off the policy?
Yes. Non-partner employees are always covered and cannot be excluded, no matter how the partners handle their own coverage.
Are partners personally liable if we skip required coverage?
Yes. Partners carry personal liability, so if the partnership was required to carry workers' comp and did not, the partners can be personally responsible for the claim and the penalties.
Why Illinois owners choose Morrow
- We shop the right market for you. In Illinois you buy workers' comp on the open market from any private carrier licensed in the state, because Illinois has no state fund; if no carrier will take you, the Illinois Workers' Compensation Assigned Risk Plan (the assigned-risk plan) is the guaranteed fallback, so we can shop your rate freely and still keep a backstop for hard-to-place work.
- We catch pricing mistakes. Your price depends heavily on the category your work falls into for pricing (the class code). Put people in the wrong category and you overpay for years. We review your payroll and classifications before you buy.
- Proof of coverage, fast. Need a certificate (proof of coverage) for a general contractor or a landlord before Monday? We turn those around the same business day for most carriers.
- We help lower the score that drives your price. Insurers give you a score based on your past claims that raises or lowers your cost (the experience modification rate). We review it each year, flag errors, and connect you with return-to-work and safety resources that bring it down.
- Real people when a claim happens. When someone gets hurt, we stay involved through the life of the claim, not just at renewal.
Related Illinois guides
Every Illinois business is set up a little differently. These companion guides answer the same question for other situations, plus the national explainers behind the terms used here.
- Business insurance in Illinois (start here)
- Workers comp: the owner's overview
- I own an LLC: do I need workers comp?
- I'm a sole proprietor: do I need workers comp?
- I own a corporation (C-corp or S-corp): do I need it?
- We're a nonprofit: do we need workers comp?
- My workers are 1099: do I still need it?
- Only part-time or seasonal staff: do I need it?
- I only employ family: do I need workers comp?
- Remote or out-of-state staff: do I need coverage?
- What happens if I don't carry workers comp?
- How much does workers comp cost?
- How do I get workers comp (even if turned down)?
- What insurance do I need for a contractor license?
- Workers compensation insurance, explained
- What workers comp costs (national guide)
- Do sole proprietors need workers comp?
- What workers comp does not cover
- Illinois plumber workers comp
This guide is general information, not legal advice. Illinois rules and penalty amounts can change, so verify current requirements with the Illinois Workers' Compensation Commission (IWCC) or a licensed advisor before you rely on them. Last updated: July 2026.