As a business owner, some risks and worries fall upon your shoulders. But knowing that you have protection in case your workers get injuries can 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, also known as workers comp, is a kind of business insurance that protects your employees in case of workplace accidents, illnesses, or injuries. It is to provide medical care, wage benefits, rehabilitation, and even death benefits to families of employees who die in the workplace.
Although most U.S. states mandate it, 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, 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 is a legitimate worker. You are 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 you are an employee, you need the following criteria to receive the benefits from this type of insurance.
- The injury must happen in your workplace. Accidents must happen on the job during work hours. If you receive injuries buying your lunch outside, this is not part of the insurance coverage.
- The employer must also possess insurance coverage. Ensure your employer is part of state-mandated or private workers’ compensation insurance coverage.
- File a report immediately. We recommend you file as soon as possible, beneficial, and in writing. There is a deadline for filing and reporting the injury.
Some workers are not eligible to receive workers’ compensation. Most of them are considered freelance and independent workers. Included in the list are:
- Seasonal workers
- Agricultural and Farmworkers
- Domestic workers like housekeepers and caregivers
- Independent contractors
- Consultants
- Temp workers
- Undocumented workers
- Freelancers
- Commission based salesman
- Foreign-based workers
Types of Workers Compensation Benefits
Workers’ compensation benefits cover several types depending on the injury or illness sustained in the work environment. Details may vary by state, but generally, there are a few primary benefits for work-related injury and death.
4 Basic Types of Benefits for Work-Related Injury and Death:
Medical Coverage or Medical Care
This benefit includes hospitalization, doctor visits, laboratory work, surgeries, medication, and medical equipment like crutches, ventilators, BP monitors, etc. In some instances, workers comp may include counseling.
Disability
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 entirely 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 you cannot work now but may be able to work again. The lost revenue for when you are unfit for work will be part of the compensation.
- 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 typically 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 or a lump sum in monthly payments.
Rehabilitation
Rehabilitation benefits will pay for therapeutic care like physical therapy. In cases where an employee cannot return to his job because of limited capabilities, he can be subjected to vocational rehabilitation, where he will be trained to develop new skills.
Death Benefits
In case of death, the employee’s spouse and children will receive the worker’s benefits. We can pay you 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 have an accident at work while doing something to further your employer’s business during your employment. We can consider these workplace injuries if you are not in your central 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’re in an accident on your way home from work, it will not be any more work-related.
Another good example is an office party. If you are attending a party outside your workplace and you sustain injuries, it is related to work since your employer sponsors the party. But if your co-worker organizes a party for a special occasion like birthdays or anniversaries, it is not related to work 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. Some companies 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 get into an accident, your employer may not give 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 due to personal grooming or self-medication is not part of workers comp insurance.
- Mental illness is unrelated to work unless a physician or health care professional can conclude that the cause of the employees’ mental illness is due to work. It will be hard to prove this; you need a thorough workup.
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 ensure that your workplace is secure and all your tools are safe. Once an employee gets into an accident or sustains an injury or illness at work, you must help your employee.
Having Workers’ Compensation Insurance is one way of securing your business environment. Mandated by most states, this insurance will protect your team and reduce conflict between employers and employees. By law, every employee has many benefits from the workers’ comp in the event they sustain any injury or illnesses at the workplace.
Main Benefits
State Compliance
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 benefit an employer to comply and significantly reduce their financial liability.
Prevents Lawsuits
A lawsuit will hurt 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 for work-related injuries.
Employee Protection
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 benefit both employer and employee. It is designed to eliminate the financial burden on the part of the employer while 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, CO, or any other state in the US. Call us today, and you are assured of excellent service and the best value for your insurance needs.