Workers compensation insurance providers coverage for workplace injuries. Learn the benefits of getting insurance and how to pick a provider.
Workers compensation is a type of insurance that provides employees with benefits if they are injured at work. While most cases of workers compensation involve injuries received at work as the result of an accident, it also accounts for any illnesses or medical conditions that develop at work. As of writing, nearly every state requires employers to have some form of workers compensation available. Some states require it no matter the size of your business, while others place employee thresholds or use different requirements based on your industry. You can learn more about the specific requirements for your state through the Department of Labor website.
As with any insurance plan, the level of coverage, as well as costs, vary depending on your provider. The types of employees covered also changes depending on the provider. Nearly all providers offer coverage for both full and part-time workers, as well as seasonal employees. Business partners and owners or contractors are typically not covered by default, but many providers offer additional coverage for these individuals.
Benefits of Workers Compensation Insurance
A common misconception is workers compensation insurance only benefits employees. While employees may receive the bulk of the benefits, there are still a number of benefits for employers. Workers compensation prevents your employees from taking legal action against you as the result of a workplace injury. Even one of these cases can be devastating for your finances. Even if you win the case, you must spend thousands of dollars in legal fees. It also draws negative attention to your business.
It also makes your employees feel safer. If you are unwilling to provide workers compensation benefits, it gives the impression you do not value your employees and you will not have their back if there is an accident.
What is Covered through Workers Compensation
The exact coverage may change depending on your insurance provider, but there are many standard injuries and illnesses covered across all providers. Both short and long-term cases are covered. For example, employees can receive compensation if they develop carpal tunnel syndrome over the course of several years, as long as a doctor can confirm the condition developed as a result of the job. Common types of injuries that are covered include cuts, fractures and sprains as the result of an accident. Longer conditions, such as hearing or vision loss are also covered.
Major illnesses and conditions are also covered under workers compensation. This includes poisoning and skin disease, as well as more serious conditions such as cancer. Mental illnesses are also covered by providers, including therapy costs for post traumatic stress disorder after an accident.
In addition to covering the costs of medical expenses, workers compensation also includes payment for lost wages and rehabilitation programs. In more severe cases, the insurance also covers the cost of disability payments and funeral costs.
Workers Compensation Exclusions
In order to make a workers compensation claim, you must be able to prove that the injury or illness is a direct result of work. If an accident occurs outside of the workplace, the insurance cannot be used. This also applies to accidents that occur during the commute to or from work. In addition, the cause of the injury or illness must be accidental and not the result of an employee ignoring safety procedures or even intentionally getting hurt. When you are shopping for an insurance provider, make sure to look over the list of exclusions for more details.
Understanding the Policies and Costs
Workers compensation uses many of the same terms as traditional insurance plans. Make sure to carefully look over each plan and understand the terminology before making any commitments. Coverage refers to which incidents, damages and conditions are covered by the insurance. Each plan also has a policy limit, which is the maximum amount the insurance provider will pay for each employee.
The premium refers to how much your company must pay. While many providers use a monthly insurance rate some of the larger providers also offer annual coverage. Workers compensation insurance also has deductibles, which refers to how much your company is required to pay out-of-pocket before insurance costs.
The cost of workers compensation insurance greatly varies based on a number of factors. Many insurance providers only offer custom quotes, determining the final price based on your annual payroll. This gives the provider a general idea of how much they are expected to pay in the case of an incident, which in turn determines how much to charge employers. Your industry also matters, as this is used to determine the overall likelihood of an incident occurring. Finally, your location also has an impact on costs.
Southwest Risk Management (SWRISK)
Purchasing workers compensation is often a difficult process because you are required to submit a great deal of financial information as part of the risk assessment. This often involves negotiating with insurance providers for rates, and may take several weeks to get a response. SWRISK is an online insurance broker that represents your company and finds coverage no matter your industry. The majority of cases are completed in less than a day. You are not required to pay anything until SWRISK finds the perfect insurance policy to suit your needs. As of writing, the company is running a Get a Free Quote & Save 30% Now campaign.
CoverWallet
Getting workers compensation is difficult for smaller businesses, as many of the providers specialize in larger businesses with dozens or even hundreds of employees. Smaller businesses have significantly different needs, given their smaller pool of employees. CoverWallet is one of the few insurance providers specifically for smaller businesses, with options for businesses with as few as one employee. It is also possible to bundle workers compensation with general liability coverage. In most states, there are also pay-as-you-go options, with coverage available immediately.