Employee injuries and illnesses can occur quickly and without notice. If the incident is serious enough to result in weeks or even months off of work, employees have the right to request workers compensation payments. Workers compensation, or workers comp for short, is a form of insurance that provides employees with wage replacement and certain medical benefits if a worker should become injured in the course of employment.
Who Should Acquire a Policy?
So, who needs workers compensation insurance? In the U.S., all states require businesses with employees to carry workers compensation insurance with few exceptions. If a business fails to acquire sufficient coverage, it could face costly fines and other penalties like possible imprisonment for the owners. These businesses may also be unable to continue conducting business in the state. Each individual state has its own set of laws that govern the exact amount of the payments and the duration of lost income benefits. Individual states also have regulations in place that dictate whether or not the employee can choose the doctor that treats the injuries.
What Does Workers Compensation Cover?
Workers compensation is designed to give your employees the benefits they need when they are unable to work due to a work-related injury or illness. Benefits that generally fall under workers compensation insurance include:
- Replacement Wages – If an employee is injured or becomes ill while in the course of employment, the worker may be eligible for workers compensation payments. These payments are designed to cover a portion of an employee’s salary, usually about two-thirds of the regular salary.
- Medical Expenses – Medical bills can quickly accumulate if an employee is forced to acquire medical services for the diagnosis and treatment of an illness or injury. In some cases, an employee may need ongoing treatment to recover, such as physical therapy. Workers compensation helps to cover these expenses.
- Death Benefits – If a work-related illness or injury results in the death of the employee, the worker’s family may be eligible for certain death benefits. These death benefits typically include coverage for funeral costs and possibly travel costs if the deceased’s body must be transported back to his or her family.
However, receiving workers compensation payments is not as easy as making a claim. The injured or ill party must first visit a healthcare professional directly after the injury or illness occurs. This healthcare provider must provide medical reports that support the need for workers compensation payments. Once this support documentation has been obtained, an employee can begin the claims filing process. If approved, the worker will soon after receive their compensation payments.
Not all types of injuries or illnesses are covered under workers compensation insurance. As a general rule of thumb, an employee who becomes injured or ill while on the job, or while acting on behalf of an employer, is eligible for workers compensation. For example, if an employee was making a delivery to a customer and they got into an accident, workers compensation insurance would likely provide certain benefits. Most insurance policies will also cover work-related injuries relating to violence, terrorism and natural disasters.
What Does Workers Compensation Not Cover?
There are certain injuries or illnesses that workers compensation will not typically cover under most state laws. This includes injuries that occur in a fight that an employee causes, because of an employees’ intentional act, when an employee is intoxicated, or during an employee’s commute. Workers compensation may also not cover incidents in which an employee is emotional but not physically injured.
There are also incidents in which workers compensation will not protect a business. This includes when a business is sued by an employee due to gross negligence, discrimination, malicious intent, failure to promote or wrongful termination. For these types of incidents, it is important to have an employment practices liability insurance policy that will help cover any associated legal costs.
It is important to understand how workers compensation will protect your business in the event that an employee sues you when they become injured or ill on the job. As a no-fault system, employees who seek workers compensation essentially give up their rights to sue their employer if they choose to receive workers compensation payments. However, there are some exceptions. If an employer intentionally harms an employee through fraud, assault, battery, defamation, or a tort injury, the worker may have the right to sue.
Speak to the Business Insurance Brokers for More Information
If you have any number of employees that work for you, then you need workers compensation insurance. However, choosing the right policy for your business is not always easy. Before settling on a policy, speak with an experienced business insurance broker and compare your options. Ready to get started? Reach out to a business insurance broker at John M. Glover today.