In 2018 alone, there were 5,250 workers who died from work-related injuries according to the Bureau of Labor Statistics. As a business owner, you know you have a lot of responsibilities to run your business and monitor your employees. Of course, you want to have a safe and healthy work environment. You also want and need to protect yourself and your business. There are so many decisions to be made related to insurance for your employees. What coverage to get? How much will it cost? Providing workers compensation insurance should be an important part of that decision making.
You certainly don’t want to be a part of those stats for worker injury or worse yet, death.
But you need to provide protection for your business and your workers in the event something terrible does happen.
Read on to learn what you need to know about workers’ compensation insurance for your business.
What Is Workers Compensation Insurance Exactly?
Some business owners see the word insurance at the end of workers’ compensation and wonder if it’s just another part of health benefits. Let’s start by working with the correct definition of workers’ compensation.
Workers’ compensation is a type of insurance that you as a business owner get to protect yourself in the event that one of your employees gets injured or worse yet dies while on the job.
This insurance protects the business owner from having to cover wages, medical expenses, and other costs from the injury, illness, or death while on the job.
In many states, workers’ compensation insurance is required. More on that in a bit.
What Does Workers Compensation Insurance Cover?
The purpose of workers’ compensation is to both offer protection for you as the employer from costs and financial support to the employees.
The insurance would provide needed financial assistance for injured employees. This might mean the insurance pays for therapy and medical expenses. The insurance would cover the employee through their rehabilitation until they are ready to return to work.
If an employee is out for a period of time because of an injury, the workers’ comp would also cover their lost wages during this time. It prevents you from having to cover it as an employer when you are not getting work from them at the same time.
Finally, it reduces the risks you face as a business from a potential lawsuit. The insurance would pay death benefits as needed. It also acts as protection from lawsuits because of injury, illness, or death while on the job.
Benefits of Workers Compensation Insurance
Workers’ compensation works as protection, really for both the worker and the employer.
Workers get their medical expenses and wages paid without having to sue to get money. It’s part of the protection offered to employers.
Most importantly though, it protects you as a business. In the event of a terrible injury medical bills can add up quickly. This could squash a small business with bills they could never afford.
The workers’ comp insurance protects the business from those huge bills. In the event the business does get sued, the workers’ compensation insurance works to protect the interests of the business owner through the whole process.
Does My State Require Workers Compensation Insurance?
While the state requirements vary from state to state, most states do require some form of workers’ compensation insurance. Start by checking the rules for your state.
Some states will require you to get the workers’ compensation when you have just one employee. Other states require it when you have three to five employees.
It should be noted that if you are the owner of the business, you do not count as an employee. You also would not be covered the same way by this insurance as your employees would be covered.
It’s highly recommended that even if your state doesn’t require it, once you have even one employee, you should have workers’ compensation insurance. Once an accident or injury could bury or end the life of a small business in related bills and expenses.
What Does Workers Compensation Cost
Workers’ compensation rates vary depending on many factors.
It might depend first on the requirements for the insurance from your state. Different states require different parts of the insurance.
Other factors include:
- Number of employees
- Claim history
- Total annual payroll
The insurance company will, of course, consider the type of business they are insuring and this will impact the cost. Some businesses come with more inherent risks than others.
The total number of employees who need to be covered will also impact the cost. The more employees, the more potential for making claims.
Where Does a Business Get Workers Compensation Insurance From?
There are a few avenues to get insurance. There are workers compensation insurers who focus on this type of insurance.
Sometimes you can also get workers comp policy from the agent who supplies your insurances. Although you want to think about getting this type of specialized insurance from a company that knows the intricacies of it.
In some cases, you can get workers’ compensation insurance from the state in which you work. If your company has had to file many claims, some insurers will opt to not insure you. In this situation, you would need to go through a state-mandated program to get coverage.
Providing Workers Compensation for Your Workforce
If you are a business owner, you want to protect the business you work so hard for. You want to make sure that if a worker gets injured or ill on the job, you are protected.
Providing workers compensation for your employees prevents your business from all the expenses and lawsuits that could come from a work-related injury or death.
If your business needs workers’ compensation insurance, contact us today to get more information. Workers’ comp is what we do and we can help you to make sure your business is protected.