As a business owner, there are risks and worries that fall upon your shoulders. But knowing that you’re protected in case of any of your workers getting injured can truly save the day for you and your finances. This is how Workers Compensation Insurance will change your life in 2022!
What is Workers Compensation Insurance?
A workers compensation insurance is also known as workers comp is a kind of business insurance that gives your employees protection in case of work-related accidents, illnesses, or injuries. It is designed to provide medical care, wage benefits, rehabilitation, and even death benefits to families of employees who died or get killed on the job.
Although it is mandated by most U.S. states, the coverage and benefits vary from state to state. The state also decides who can sell and handle this type of insurance. It can be from state-run agencies, from the state itself, or private insurance companies.
Who are Eligible to Receive Workers Compensation Insurance?
Any employee is eligible to receive workers comp. But not everyone working can be defined as a legitimate worker. You are considered an employee if you are:
- Directly employed by an employer.
- Has a long-term position in the company.
- Uses the employer’s tools and equipment.
- Performs regular tasks for the business of the employer.
- Can work part-time or full-time depending on the needs of the employer.
If it has been established that you are an employee, then you need the following criteria to be able to receive the benefits from this type of insurance.
- The injury must be work-related. Accidents must happen on the job during work hours. If you are injured buying your lunch outside, will not be covered by the insurance.
- The employer must be insured. Make sure that your employer is covered by either state-mandated or private workers’ compensation insurance.
- File a report immediately. It is recommended that filing at the soonest possible time is beneficial and in writing. There is a deadline for filing and reporting the injury.
There are workers who are not eligible to receive workers’ compensation. Most of them are those considered freelance and independent workers. Included in the list are:
- Seasonal workers
- Agricultural and Farmworkers
- Domestic workers like housekeepers and caregivers
- Independent contractors
- Temp workers
- Undocumented workers
- Commission based salesman
- Foreign-based workers
Types of Workers Compensation Benefits
Workers’ compensation benefits cover several types of coverages depending on the injury or illness sustained from the work environment. Details may vary by state but in general, there are a few basic types of benefits for work-related injury and death.
4 Basic Types of Benefits for Work-Related Injury and Death:
Medical Coverage or Medical Care
This type of benefit includes hospitalization, doctor visits, laboratory works, surgeries, medication, and medical equipment like crutches, ventilators, BP monitors, and the likes. In some instances, workers comp may include counseling.
If your illness or injury makes it hard for you to work, you may be eligible to receive disability benefits.
There are 4 categories for this benefit:
- Temporary Partial Disability – this type prevents you from doing your job fully for a short period of time. Let’s say because of your injury, you can only work for 4 hours instead of 8. Your reduced earning can be compensated with this coverage.
- Temporary Total Disability – this type prevents you from working at all for a small amount of time. It means that you are unable to work now but may be able to work again in the future. The lost revenue for the time you are unfit for work will be compensated.
- Permanent Partial Disability – payment for this type of disability will depend on the body part and the percentage of that body part that is completely disabled. States normally limit the length of time you can get benefits for this.
- Permanent Total Disability – this means that your injuries are too extensive for you to be able to go back to work. The body parts you need may not be usable for your work. You will receive a permanent total disability for this either in monthly payments or a lump sum.
Rehabilitation benefits will pay for therapeutic care like physical therapy. In cases where an employee is unable to return to his job because of limited capabilities, he can be subjected to vocational rehabilitation where he will be trained to develop new skills.
In case of death, the spouse and children of the employee will receive the worker’s benefits. They are often paid in regular payments or a one-time lump sum. The amount varies from state to state and is calculated based on a certain percentage. Death benefits also include funeral expenses and burial costs.
What Qualifies as a Work-Related Injury?
A work-related injury is when you had an accident at work while you are doing something to further the business of your employer in the course of your employment. These work-related injuries can also be considered even if you are not in your main workplace but in a different location.
If for example, you got into an accident on the way to a meeting with a client for your employer. This did not occur at the office but on the road on your way to the meeting place. This can also be classified as a work-related injury. But if you got into an accident on your way home from work, it will not anymore be considered work-related.
Another good example is an office party. If you are attending an office-sponsored party in a location outside of your workplace and you get injured, it will still be considered work-related since the party is sponsored by your employer. But if it is a party organized by a co-worker for a special occasion like birthdays or anniversaries, it will not be considered work-related anymore.
Examples of Non-Work-Related Injury
- Workers comp does not include accidents or injuries sustained during your commute. If an accident occurs on your travel to and from work, you will not be eligible for benefits.
- Misconduct at work. Accidents caused by horse playing or goofing around the workplace will not be eligible as well. Carelessness, taking drugs, or drinking alcohol at work are some examples of misconduct at work.
- Voluntary participation in a wellness program. There are some companies that offer programs to promote a healthy lifestyle. They may offer Zumba classes, exercise classes, indoor or outdoor sports, and vaccines. If you volunteer to participate in any of these and you get into an accident, your employer is exempted from giving you workers comp benefits.
- Illnesses not caused by workplace exposure. These are the common conditions that most people get throughout their life. Examples are the flu, colds, and cough.
- Self-inflicted injury. Any injury or illness caused by personal grooming or self-medication is not included in workers comp insurance.
- Mental illness is not considered work-related unless a physician or health care professional will be able to conclude that the cause of the employees’ mental illness is due to work. It will be hard to prove this and a thorough workup will be needed.
Benefits of Having Workers Compensation Insurance
As an employer, it is your duty and responsibility to ensure the safety of your employees. It is also your responsibility to make sure that your workplace is secure and all your tools are safe to use. Once an employee gets into an accident or sustained an injury or illness at work, it is your duty to help your employee.
Having a Workers Compensation Insurance is one way of securing your business environment. Mandated by most states, this kind of insurance will protect your team and reduce conflict between employers and employees. By law, every employee is entitled to the many benefits of the workers’ comp in the event they sustain any injury or illnesses at the workplace.
An uninsured employer will be required to reimburse the state in case an employee sustains injuries at work. This includes all the costs plus interest, attorney fees, penalties, and more. Since it is mandated by law to have workers comp, it would be beneficial for an employer to comply and significantly reduce their financial liability.
A lawsuit will have a negative effect on your business. Having a worker’s insurance will prevent legal suits in case of workplace injuries. You will be exempted from being sued by your employee in relation to work-related injuries.
Your employees will be protected when accidents happen. They will get the benefits due to them without your company absorbing the financial burden.
The workers’ compensation insurance will definitely benefit both employer and employee. It is designed to eliminate the financial burden on the part of the employer at the same time giving the full benefits to its employees. Knowing that you have coverage, will keep your mind at ease and you can focus on improving your business.
Advantage Insurance Solutions has a team of insurance experts who can help you with your insurance in Denver, Colorado, or any other state in the US. Call us today and you are assured of great service and best value for your insurance needs.