What is the term for states that require employers to purchase coverage from a designated workers' compensation program?

The correct term for states that require employers to purchase coverage from a designated workers' compensation program is "monopolistic." In monopolistic states, the government is the sole provider of workers' compensation insurance, and employers must obtain coverage exclusively from the state fund. This means that private insurance carriers are not permitted to provide workers' compensation coverage within these states.

Monopolistic systems are designed to ensure that all employees have access to workers' compensation benefits and that the program is consistently managed and regulated by the state. Employers in these states cannot opt to purchase coverage from private insurers, which creates a uniform system for handling workers' compensation claims.

In contrast, in compulsory states, employers are mandated to provide workers' compensation insurance; however, they have the option to choose between private insurers or state programs. Elective states allow employers the flexibility to either provide coverage or opt out, while competitive states have a mix where employers can choose between state-run and private insurance options but do not have a mandatory commitment to a single source. Understanding these distinctions is crucial in grasping how workers' compensation is regulated and provided in different states.