What Does Workers’ Compensation Cover?
Workers’ compensation insurance, often known as workman’s comp, pays payments to employees who are injured or sick as a result of their job. It also covers disability benefits, salary replacement payments, and death benefits.
Workers’ compensation also limits your culpability for workplace injuries and diseases. If you do not provide coverage, your workers may sue you for a work-related accident or sickness to recover medical expenses or lost income. Workers’ compensation insurance is required in most states for firms with employees. However, because each state has distinct standards, your workers’ compensation insurance needs will be determined by the state or states where you conduct business.
What Does Workers’ Compensation Cover?
If your employee is injured or becomes ill at work, workers’ compensation payments can assist cover the following:
- Medical costs
- Wages lost
- Costs of ongoing care
- Funeral costs
These workers’ compensation payments are not accessible if your employee is injured or becomes ill outside of work. Benefits may also be denied for inebriated personnel who cause an accident or purposefully injure themselves.
Medical Bills
Workers’ compensation insurance covers medical expenditures incurred as a result of a work-related accident or sickness. This might involve visits to the emergency department, essential operations, and medicines. For example, if one of your electricians slashes their hand at a customer’s house, workers’ compensation insurance can assist pay the cost of their hospitalization.
Unpaid Wages
Workers’ compensation compensates your employee for some of their lost wages if they require time off to recuperate from a work-related accident or sickness. So, if your restaurant cook falls into a pot of boiling water and is unable to work for two weeks, workers’ compensation coverage can assist compensate her for part of her missed pay.
Continued Care
There are some workplace-related diseases or injuries that might be so serious that they require many treatments. For instance, workers’ compensation insurance can assist in paying for continuing medical expenses, such as physical therapy, if a warehouse worker injures their back while carrying bulky boxes.
Funeral expenses
Workers’ compensation insurance can assist with burial expenses and provide death benefits to your employee’s beneficiaries in the terrible event that they pass away due to a work-related injury.
Illness
Your employees may occasionally be exposed to unhealthy substances or allergies while working, which might make them unwell. Workers’ compensation insurance can assist in defraying your employee’s medical expenses if they become ill as a result of an incident or condition that occurred at work.
Recurrent Injury
Not every workplace injury is the consequence of one specific traumatic event. It may take months or years for repetitive injuries like carpal tunnel syndrome to manifest. Workers’ compensation might assist in covering treatment costs and ongoing care expenses if your receptionist gets carpal tunnel syndrome as a result of years of bad ergonomic typing.
Disability
Some workplace accidents might be serious enough to render your employee permanently or temporarily disabled. Your handicapped employees may be eligible for benefits under your workers’ compensation policy to assist with paying their medical expenses and partially making up for missed income.
Let’s imagine your foreman suffers a work-related injury that leaves him partially crippled and without the use of one of his legs. He is unable to go back to work and requires ongoing medical care as well as financial assistance. His medical expenses can be covered by workers’ compensation, and the disability payments can make up part of the lost salary.
Who Is Covered by Workers’ Compensation?
Several criteria, such as particular job duties and the size of your company, decide whether employees require workers’ compensation insurance. State requirements vary, but most require workers compensation coverage for full-time employees. Some states have workers’ compensation regulations for contractors, temps, and interns. It is critical that you understand what your state needs for workers’ compensation coverage.
Some states do not need workers’ compensation coverage for the following:
- Farmhands Insurance brokers
- Children under a specific age
- Temporary employees
- Entrepreneurs and business partners
- Real estate brokers
Employees of the federal government are likewise not protected by state-mandated workers’ compensation insurance. Instead, they are protected by federal workers’ compensation. These exceptions do not apply in every state, so you must understand your state’s workers’ compensation laws.
