Understanding the Basics of Workers’ Compensation

Protecting your brand as well as your employees should be made a priority when insuring your small business, and having workers’ compensation insurance is not an option with regulations in place by state law. However, it is important you understand the basics of the workers’ compensation system when investing in the proper amount of coverage.

While you likely know the advantages of having a basic policy including liability insurance, errors and omissions insurance as well as consultant insurance, workers’ compensation covers illness and work-related injury. Even if an accident or incident occurs off premises, you will need protection should an employee be affected while performing a job-related task. This includes social events, travel, errands or regular off-site duties.

What Does Workers’ Compensations Insurance Cover?
Illnesses that can be covered include those that occur due to exposure, while injuries that develop due to repetitive actions can also be covered, such as carpal tunnel syndrome or back problems.

This should help put your mind at ease should you run a business that puts employees at a higher-risk or if they are required to travel an extended amount.  Some things, however, are not included in workers’ compensation coverage.

Should one of your employees be injured while under the influence of drugs or alcohol, a claim will likely be denied. The same is true of injuries that are obtained from a fight started by the employee harmed as well as horseplay while working. Self-inflicted injuries are also disapproved by this coverage, along with felony-related injuries. Employees who have been terminated or otherwise laid off are also likely to be denied. Independent contractors are also unable to collect compensation through your company.

Some benefits included under workers’ compensation include replacement of income due to being unable to work and earn a paycheck, costs associated with medical expenses, surgery, prescriptions and doctor’s visits. Additional payment may be necessary should rehabilitation be needed, such as job placement assistance, further education or job training.

In some cases, permanent or temporary disability may need to be provided to employees and payments can be determined by the injury. Should an accident be fatal, death benefits are provided to the employer’s dependents.

Substantial Insurance Helps Protect Your Business 
Having the right amount of insurance is crucial in protecting yourself and your small business from lawsuits, but there are other measure that you should take to keep yourself from being declared liable by a court including injuries acquired because of recklessness, absence of worker’s compensation or negligence in any other way. This is why it is important to stay on top of necessary repairs and replacements throughout your company.

Though it may seem like most bases are covered by workers’ compensation insurance, you as an employer will still be required to fulfill obligations through the system. Those who fail to do so may face penalties, fines or lawsuits, depending on the severity and further details of the claim.

Another important detail is providing forms in a timely manner for your employees, as claims should be maid as soon as possible. Additional information should also be provided including employee’s rights regarding worker’s compensation. Some states also require employers to have these posted in a place where they are easily seen on a day-to-day basis.

Rules for the amount of workers’ compensation that must be held often depend on how many employees there are working for you, though additional factors may come into play such as the amount of risk associated with your particular industry or how frequently employees travel for work.