Worker's Compensation Insurance

Workers compensation insurance is required in most states. This business insurance provides coverage for employees with work related injuries or illnesses. Workers comp not only benefits employees directly but also protects employers from legal liability should employees decide to sue for damages.

What does Workers Compensation Cover?

When employees are injured, the insurance will pay employee medical expenses along with any lost wages resulting from their inability to work. Coverage extends to employees whether they are at the business location or during business operations off site. In the event an employee cannot return to his or her usual position, some states provide vocational rehabilitation benefits for employee retraining so they can obtain a position in a new industry or field. In the event of an employee's death, benefits are paid to surviving family members

Employers' liability within workers compensation insurance also provides added protection for employers. It will pay employer legal expenses when an employee makes an inappropriate or false claim of injury or illness.

Where to purchase Workers Comp Insurance?

For most states nationwide, workers compensation insurance can be purchased from private insurance carriers through brokers or agents. Some states have state created funds that serve as an insurance carrier or insurer of last resort for those companies that cannot obtain coverage from a private carrier. Employers also have the option to self-insure or join associations for group self-insurance and/or rates.

How much does it cost?

The cost of workers compensation is determined by each state. Premium rates are based on industry classifications, a company's past injury or loss history, payroll and special underwriting considerations. Those just purchasing workers compensation for the first time will have rates based on payroll and industry until actual experience is gained over a period of a few years of coverage.

What about employee safety?

Safety and prevention of accidents is a big concern with both employers, the government and workers comp insurance carriers. Many states require that employee safety advisory notices be posted in an area frequented by employees. These notices to employees include information about the employer's insurance company and where to get medical help for injuries. Employers are also required to have written safety programs and regular safety meetings with their employees.

Each state has its own specific set of rules, regulations and laws as they pertain to workers compensation for employers and employees. To learn more about the state specific insurance requirements for your area, access our individual state pages to learn more.