Under Iowa law, employers are required to purchase Workers' Compensation insurance through a private insurance carrier or be self-insured.The employer must purchase Workers' Comp insurance and pay the premium charged by the insurance company. When an employee is eligible for Workers' Comp benefits, the insurance company is the one to provide these benefits to the injured employee. When the employer is self-insured, then it is the employer who is responsible for paying Workers' Comp benefits to an injured employee.
If an employer fails to provide Workers' Comp insurance for its employees, they may be liable for Workers' Compensation benefits or for damages in a civil action. Furthermore, an employer must have in place Workers' Comp insurance for its employees before legally conducting any business. Anyone who does so willingly and knowingly can be found guilty of a felony.