Workers' Compensation Insurance: Protecting Your Team and Your Business

Work-related injuries and illnesses can happen in any workplace, and when they do, they can put both your employees and your business at risk.

That's where workers' compensation insurance comes in, reducing your liability as an employer and providing crucial support to your team.

What is Workers' Compensation Insurance?

In simple terms, workers’ compensation Insurance is a safety net for employees and employers alike. Without this coverage, employees have the legal right to sue their employer for work-related injuries or illnesses to help cover their medical expenses and lost wages. This can be a costly and time-consuming process for both parties.

State-by-State Rules

Every state in the U.S. has its own set of rules and requirements for workers’ compensation insurance. If you're a business owner, the state (or states) where you operate will dictate your workers' comp obligations. It's your responsibility to purchase coverage through a licensed insurance company to comply with these regulations.

What Does Workers' Compensation Cover?

Workers' Compensation Insurance typically covers:

• Medical Expenses: This includes essential medical costs related to work-related injuries or illnesses, such as emergency room visits, surgeries, needed therapies, and prescriptions. For example, if one of your electricians injures their hand while on the job, workers’ compensation can help cover their hospital bills.
• Missed Wages: If an employee needs time off to recover from a work-related injury or illness, workers’ comp can replace some of their lost income. For instance, if your restaurant chef scalds her arm with boiling water and can't work for a couple of weeks, workers’ compensation coverage can provide financial support.
• Ongoing Care: In cases of severe injuries or illnesses that require extended treatment, like physical therapy for a warehouse employee who hurt their back, workers’ compensation coverage can help cover the ongoing care costs.
• Funeral Costs: In tragic situations where an employee loses their life due to a work-related incident, workers’ compensation coverage can assist with funeral expenses and provide death benefits to the employee's beneficiaries.
• Illness: Sometimes, employees may develop illnesses due to workplace conditions, such as exposure to harmful chemicals. Workers’ compensation coverage can help cover the costs of necessary treatment and ongoing care for such illnesses.
• Repetitive Injury: Not all work-related injuries are the result of a single traumatic incident. Conditions like carpal tunnel syndrome can develop over time. If an employee develops such an ailment due to work-related factors, workers' compensation coverage can cover treatment and ongoing care expenses.
• Disability: Severe work injuries may lead to temporary or permanent disabilities. Workers’ compensation provides benefits to help pay for medical bills and replace a portion of lost wages. For instance, if your foreman becomes partially disabled due to a work-related accident, workers' compensation coverage can support their treatment costs and provide disability benefits.

Who Needs Workers' Comp Coverage?

The requirement for workers’ compensation coverage varies depending on factors like specific job roles and the size of your business. While full-time employees are typically covered in most states, some states also have provisions for contractors, temporary workers, and interns. It's crucial to understand your state's requirements to ensure compliance.

The Workers' Compensation Claim Process

The process for filing workers' comp claims varies by state, but some key steps apply universally:

1. Ensure that injured or ill employees receive immediate medical care.
2. Immediately complete a report of the incident, including pictures, to be provided to the insurance carrier.
3. Interview any potential witnesses and provide them to the insurance carrier along with the incident report.
4. Promptly notify your employees or their representatives about the work-related injury or illness.
5. Contact your workers' compensation provider to submit a claim, and in some cases, notify a state-run workers' comp board, such as OSHA.
6. Your insurance company will review the claim and either approve or deny benefits.
7. If approved, your employee will receive the benefits and compensation they need.

Most states impose a time limit for employees to report a workers' compensation injury to their supervisor, usually within 30 to 90 days (about 3 months). Employers may also have time limits for reporting to their insurance company. Understanding these rules and any statutes of limitations in your state is essential.

Selecting the Right Workers' Compensation Coverage

Choosing the right workers’ compensation coverage is crucial for your business. OneDigital's Property and Casualty practice can help you navigate the specific requirements in your state and recommend the level of coverage that best suits your industry. Connect with a member of our team today to ensure you are protecting both your employees and your business.

Interested in learning more about how to create a culture of safety? Check out this recent blog: The Science of Ergonomics: Improving Workplace Safety and Wellbeing.