Every business owner needs to be aware of how workers’ compensation protects their company. Workers’ compensation insurance significantly decreases the risk a company could experience a devastating financial loss because of a serious accident involving one of their employees. It will provide the benefit of financial protection if a worker is injured when they are engaged in their normal work duties.
When it was established over a hundred years ago, workers’ compensation was often spoken about as the grand bargain between workers and employers. The worker’s compensation system is designed to be a cooperative agreement designed to decrease the number of conflicts that occur between employees and business owners when an employee is injured during the course of working for the company.
Three Main Benefits
There are three main ways a business benefits from having workers’ compensation insurance.
- Having it keeps a company compliant with the laws of the state where it is located.
- It can help mitigate the chance of an employee filing a lawsuit against a company for a work-related illness or injury.
- It covers a company’s workers for any legitimate injuries or illness related to working for the company.
There are good workers’ compensation insurance policies that are affordable. Business owners need to review their options when purchasing this insurance. They may discover they need to add more coverage. There are certain things a business owner will want to have covered by their worker’s compensation policy.
- Reimbursement percentage for the loss of wages.
- Legal expenses should an employee file a claim for a work related injury or illness. This is commonly provided by workers’ compensation insurance, but it’s important to review it and make certain the coverage is sufficient.
- Financial support and funeral expenses to a deceased’s dependents
- Coverage for employees who become injured in a state outside were a company normally operates
- Coverage for various types of illnesses and injuries.
Required By Law
Individuals who own a company are considered productive members of society. They are people who contribute to the economy, provide jobs and improve the workforce. When an entrepreneur is busy developing their business plan, they don’t anticipate being fined, prosecuted, or even imprisoned for an unfortunate mishap that occurs with the company they have worked hard to establish. Unfortunately, there is a real chance of this happening if a business owner doesn’t comply with the laws covering workers’ compensation. Each state government has a specific agency designated to oversee its workers’ compensation program. Most states require workers to be covered by such a policy. If anyone wants to learn about a particular state’s workers’ compensation laws, their state’s website should contain important information about it.
If a business does not carry workers’ compensation insurance for the business and its employees, the families of workers could sue the business in civil court for any type of workplace injury or death. If a company doesn’t have coverage, it could leave them financially devastated. In some cases, it could even make them liable for a criminal investigation. Business owners know operating a business is often stressful and fast-paced. Having the required workers’ compensation insurance decreases their risk of experiencing a complicated legal problem.
If a worker is unable to perform their duties because of a work-related illness or injury, then workers’ compensation insurance can provide them with a percentage of their lost wages. It will also cover the expenses associated with medical treatments needed by the employee. This coverage may include medications, physical therapy, surgeries and more. The goal will be to get the employee back to work. Should an employee unfortunately die, this insurance can assist with financial benefits to the employee’s family and more.
The workers’ compensation system is not perfect. It is a necessary cost of doing business that an employer is not able to avoid. The possible financial consequences from a single injured employee could cost a company as much if not more than what it will pay in insurance premiums. Having workers’ compensation insurance makes it possible for employers to have one less thing to worry about as they try to grow their business.