Posted on May 19, 2014
Workers compensation insurance is a vital coverage available to employers to protect their employees in the event of work related injuries or illnesses. All states except for Texas require that workers comp coverage be purchased by employers.
Workers Compensation Governed by States
Workers comp insurance is not regulated by the federal government. Instead, each state has developed their own set of workers compensation laws that regulate how employee claims and treatment is handled as well as how employers are to provide coverage. Each state?s laws are typically considered no fault systems of coverage meaning that claims of injured employees are covered regardless of who is at fault for the injury.
What Does Workers Comp Cover?
When an employee is injured or becomes ill during the course of his or her employment, this insurance coverage will pay for medical treatment costs, wage replacement if they are temporarily or permanently disabled as well as a benefit to the employee?s family if the injury causes death. Some states will also provide vocational rehabilitation benefits to retrain employees that are unable to return to their usual duties.
Many states require that all employees be covered; however, there are often coverage exemptions provided by state law. These exemptions typically include corporate officers, independent contractors, domestic help and farm workers. Some states will allow exempt members to elect coverage if they choose.
Why is Workers? Compensation Insurance Needed?
Workers compensation coverage protects employers so that they are not liable for employee injury or illness, and it also protects them from lawsuits due to negligence. Instead, the workers compensation system provides remedy for the employee in the form of medical and wage benefits.
This vital protection for both employees and employers may be purchased from private insurance carriers, through self-insurance or by state run funds that act as private insurers and carriers of last resort for those unable to obtain coverage elsewhere.