Why Workers Compensation Is Important

Here’s What Really Matters in Workers’ Compensation Insurance

What really matters in workers’ compensation insurance? That’s a pretty big question. Employees are the most valuable assets of a company. They are the backbone of an organization and are the major contributors to the success of any business. Any small or big enterprises rely on their employees to ensure the smooth operation of their business.

To protect your most valuable asset, make sure that they are safeguarded at all times. They need to have a defense system in their workplace in case there are unfortunate events like accidents, injuries, illnesses, and even death. To guarantee their protection, you need workers’ compensation. 

What Is Workers’ Compensation Insurance?

Workers’ compensation insurance is a type of insurance that provides benefits for work-related injuries, illnesses, and death in the workplace. Almost all U.S. states mandate this to protect employees. Workers’ compensation protects both employers and employees. Workers or employees must give up their right to sue their employers once they accept workers’ comp thus protecting the business owner. The employees on the other hand have protection throughout their employment with the company. 

How Does Workers’ Compensation Work?

When a worker or employee get injuries in the workplace, they can file a claim on workers’ comp to help them with the cost that their injury or illness may require. This will include all medical costs, wage benefits, ongoing care costs,  and death benefits. 

4 types of benefits included in workers comp

As mentioned above, these benefits will have different settlement outcomes depending on the injury or illness. Different states have different policies and it is better to learn the laws of the state where your business is located.  

1. Medical Treatment– this includes all hospital costs, doctor’s visits, surgery, laboratory exams, and medical equipment such as a wheelchair as needed.

2. Lost Wages – if workers need time off because of an injury or illness, workers comp will replace lost income if they are partially or totally disabled for more than seven days. The amount is subject to a maximum cap.  

3. Ongoing Care Costs – some injuries are severe enough to need therapy and rehab to help cope and recover. Workers’ comp can help in covering these costs as well. Also included are care and training expenses to regain the skills of the worker after an injury. 

4. Death Benefits – If an employee, unfortunately, dies because of severe injuries, workers’ comp will pay for the funeral costs and provide beneficiaries with death benefits. 

Why Is Workers’ Compensation Important?

Workers’ compensation helps businesses from undue financial burden following an injury or illness in the workplace. It ensures that your assets are well protected and can easily access medical treatments and rehabilitation after an accident. People won’t sue or fine you if you comply with this insurance coverage thus saving businesses.

For employees, workers’ comp guarantees them financial benefits for an on-the-job injury. This type of insurance is in the favor of the employee. We assure you that we will compensate for accidents in the workplace to give you peace of mind. In case of death, beneficiaries of the worker will be able to receive death benefits from the insurer. 

What Are Considered As Work-Related Injuries?

Any injury you sustain in the workplace while doing your job is a work-related injury. If you are attending a seminar, party, or any social event as a representative of your company and you are ill or you obtain injuries it is still a work-related injury. If a worker gets into a car accident whether as a driver or passenger during work hours doing a task for the company, it will still be claimable.  

Injuries that are not part of workers’ comp are when:

• The worker obtains injuries during the commute to and from work. Any injury you sustain from commuting before and after working hours is not part of the coverage. 
• Workers get injuries during a lunch break inside the workplace or out. If the worker decides to eat in the pantry or go out for lunch and gets into an accident, it will not be part of the insurance policy. 
• The worker gets injuries because of horseplay in the workplace. Some workers may decide to prank or clown around the worksite. When they get injuries even during working hours, it will not be part of workers’ comp. 
• The worker gets injuries because of being under the influence of alcohol and drugs. In case there is evidence that a worker comes to work drunk or on any prohibited substance and gets into an accident, this will not be part of the insurance coverage.

What Is Workers’ Compensation Fraud?

Filing a claim can be difficult if your company is marked due to fraud. Fraud comes in many forms. Your employer, the employee, the medical provider, the lawyer, and even in collusion with each other can sue you with fraud. Fraud occurs when someone willfully or intentionally conceals information or makes false statements. 

Employer fraud is when:

• Employees are misclassified as contractors
• The employer under reports payroll
• The employer deducts premium from the employee

Employee fraud happens when:

• Employee exaggerates symptoms and injuries
• Another employee claims a non-work-related injury as a work-related injury
• The employee does not keep doctor’s appointments or therapy
• Employee returns to work and still claims lost wages

A medical practitioner or provider fraud is when:

• if they bill you with services and treatments even if not performed
• if they also give you unnecessary treatments or tests 

What Really Matters In Workers’ Compensation

Three things really matter in workers’ comp. 

1. Business owners have a duty to protect their workers to the fullest. 

Business owners have a requirement to purchase workers’ compensation insurance for all employees. Their responsibilities include:

1. Making a copy of the regulations and posting them in areas easily accessible to all employees. All workers must be able to read and understand what is posted. 
2. Rectifying all workplace conditions that are hazardous to the workers. Places that can potentially cause injury or cause an illness must all be corrected at the soonest possible time.  
3. Establishing health and safety standards and programs in accordance with the rules and regulations of the state
4. Maintaining in good condition all tools and equipment used inside the workplace
5. Providing all workers with the proper information and training necessary will ensure the safety of all employees inside the workplace.  

2. Employees should be educated on claim procedures and benefits.

Workers should acquaint themselves with the claim process of workers’ compensation. There are steps to follow to ensure a smooth process. But before anything else, once an accident occurs, first aid must be administered immediately. If the injury or illness is severe, workers must be brought to the nearest medical facility as soon as possible. 

Other things that matter…

1. Once an emergency you did an first aid, you should file a written report within 24 to 48 hours after the incident with the insurance provider. 
2. Key information must be provided including:

• Date and location of the incident
• Injury or illness sustained in the accident
• Body part injured
• Number of days work will be missed
• Return to work date

3. HR or the person in charge must explain the process to the worker and what to expect from their claim.
4. Workers must maintain communication with all parties involved. They should be in constant contact with the employer, insurer, doctors, and other persons involved in the claim process. 
5. Workers must follow all doctor’s orders, take their medications and do rehabilitation if needed to ensure that they will be able to get well the soonest possible time and return to work if viable. 

3. Choose the right insurer.

Your insurance carrier is the most important factor in workers’ compensation. There are three providers where business owners can purchase insurance for their organization:

1. From the state itself
2. From state-run private carriers
3. Private insurance companies

More things that matter

Getting workers’ comp from the state may be a good idea if you are a new business. This would enable your company to learn more about the ins and outs of workers’ compensation in your state. New businesses typically have a hard time getting workers’ comp because of inexperience. 

However, if you know a good insurer with an expert agent, you can get your insurance coverage from private insurers. Here are the advantages of purchasing from private companies:

• We will assign your company with an agent to review your organization and give advice on the best coverage for the workers
• Because private insurers set their own prices, they will be able to give discounts to first-time buyers
• Consolidation will be easy if all business insurance policies have one source. Management of all coverages, renewals, and payments will be easier. 

The Bottomline

Every state has its own programs and laws. Some states exempt businesses with less than five employees and at least one state requires even contractors to have workers comp. The important thing is that employees should always be protected in whatever way possible. The more they have protection, the better an organization will be. 

To know more about workers’ compensation insurance and how it can help your business, call our expert risks here at Advantage Insurance Solutions here in Denver, CO today. We’re sure that we can help you find the right business insurance options.