Workmans Comp, commonly referred to as workers compensation or workers’ comp, is a government-mandated form of insurance. It provides medical benefits and wage replacements to workers or employees who get sick or injured on the job or due to the job. This insurance works in exchange for a mandatory wave of the workers right to sue the employer for negligence. Workman’s compensation benefits include payments to cover lost wages, medical treatments, and even death benefits.
In most states in the United States, employers are mandated to purchase workers’ compensation insurance, even if they have just one employee. Texas is one of the states where employers are not required to maintain workers’ compensation insurance. Keep in mind that a workers’ compensation claim can only be paid if the insurer or employer confirms that the illness or injury was caused by the job. If the employer or the insurance company rejects the worker’s compensation, the judge decides on the case.
Who Needs Workmans Comp Insurance?
Just like I have mentioned above, many states require businesses to have this insurance even if they have just one employee. Other states, such as West Virginia and Alabama, do not require workers compensation if you have fewer than five employees. Few states have exemptions for worker compensation requirements based on work type.
For instance, you are not required to purchase the insurance for domestic workers employed by parents or for people who volunteer to work for a nonprofit ski patrol or recreational camp in California. Meanwhile, Texas does not require businesses to have the policy at all, no matter how many employees they have. It only depends on whether the employee purchases the policy or not.
What Does Workmans Comp Cover?
In this section, we will take a closer look at the benefits that are covered by workers compensation insurance.
- Medical bills, including medications, emergency surgeries, and hospital visits
- Disability benefits are made available if the work-related injury causes permanent or partial disability.
- Lost wages are partially covered when the employee needs to stay away from work due to a work-related injury or illness.
- Death benefits include survivor benefits for the employee’s family and funeral costs.
Workers compensation benefits are paid no matter who was at fault, as long as they are work-related. Just as stated above, the workers compensation law typically prevents workers from suing their employees for work-related illness or injury.
What does Workers Compensation Not Cover?
Workers are covered for the workers compensation no matter the number of hours they work. However, there are a few exclusions that could lead to a denied worker’s compensation claim. They Include;
- Workplace fight: If the injury happens during a fight with another worker, the insurance may not cover the injuries. Except the fight is related to or due to work.
- Substance abuse or intoxication: Many state laws exclude coverage if the person was intoxicated and that led to the injury.
- Commuting: Traveling from and to work is totally excluded from this workman’s compensation coverage. The person may only be covered if they are in the company’s car or they don’t have a physical office, such as a traveling sales worker.
Benefits of Workmans Comp Coverage
This insurance benefits both your employees and your small business. Below are a few instances where the workers’ compensation coverage benefits
- It will help cover the employee, even if they are to blame for the accident.
- An illness or accident that leads to an extended absence at work will be covered, as the policy will cover partial lost wages and ongoing care costs.
- It will help reduce your business’s out-of-pocket expenses.
This insurance will help pay for medical expenses, lost wages, funeral costs, and even family support.
How much does Workmans Comp cost?
Workers’ compensation insurance costs about $542 a year, according to our research. The costs will be based on the job classifications of employees. The classifications reflect job riskiness. Any past worker’s compensation claims and the payroll of the business also affect the insurance premium.
Where to Purchase Workmans Comp Insurance
You want to purchase workers’ compensation insurance. Well, you have various options depending on your state. You might be able to purchase workman’s compensation from a state-run agency or private insurance companies, or you might have both. Private insurers set their own prices and even reject or approve customers. So you may be able to get a better price from a private insurance company than from a state fund.
However, if you are not able to get the coverage that you want from a private company, you should check out a state-funded program. In a competitive, private insurer-funded workers’ compensation program, state-funded programs compete for customers.
How to apply for a Workmans Comp claim
The rules for applying for workers’ compensation totally depend on the state. Nevertheless, an employee with a job-related illness or injury should:
- Put down full details of the illness or injury, including the names of witnesses and photos, when possible.
- Report this injury or illness to the business employer. The employer will then take it from there and file your claim with the insurance company.
Ensure that you follow through with the employer’s insurer to make sure that your claim is filed. If it gets denied, you can then appeal the decision with the worker’s compensation board in your state.
