Workers compensation insurance is an insurance policy that provides medical coverage, wage replacement and vocational rehabilitation (if necessary) if an employee is injured at work. With the ever rising economy, businesses are always looking for ways to minimize cost by skipping Workers Compensation Insurance coverage, as they are often expensive. This attitude of employer’s is not only wise, but also illegal in most states. Since, any business has the potential for employee injury, it is important that businesses should consider taking Worker’s Compensation Insurance for their organization. It will protect employees and their families from financial hardship in the event of work related injury.
There are four types of worker's compensation benefits :
a. Medical benefits:
Medical benefits pay for the medical care to treat the employee suffering from work related injury
b. Income benefits:
Income benefits pay the employees a portion of their lost wages
c. Death benefits:
Death benefits pay some lost wages to the worker’s family killed on the job
d. Burial benefits:
Burial benefits pay for some funeral expenses
Workers compensation insurance not only benefits the employee, but also the employer. Employers get protected from lawsuits initiated by employees injured on the job by taking this insurance policy.
Guide to Worker’s Compensation Insurance:
a. Research: Conduct a research on your state’s workers’ compensation law and follow the laws of the state where operations are based.
b. Company details: Collect all data’s related to your business such as company description, the number of employees working, checklist of the safety practices and procedures followed, operations manual or employee handbook, and pictures of the facility.
c. Contact an agent: Contact an insurance agent who has experience with worker’s compensation coverage. In other cases, insurance coverage quotes can be obtained online too.
d. Shop around and secure the coverage required for your business: Most states require businesses to buy policies from insurance carriers. Since, all insurance carriers are not equal, it is important that you shop around for the best coverage at the best prices. Each insurance carrier would use different factors to rate worker’s compensation coverage.
The level of coverage that is required for a business often depends on the type of industry the business belongs to and the number of staff working there. For instance, a construction business typically requires more coverage than an office due to the increased risk involved in such types of job.
e. Make the purchase: Choose an insurance carrier and buy the insurance policy. Follow any underwriting requirements, and give updates whenever employees leave the organization or new employees are added to your organization.
Worker’s Compensation Insurance protects businesses from spending their money on costly employee claims. But, this is not the only way to protect businesses from injury and illnesses. To reduce the likelihood of getting hurt while working, businesses can implement some basic protection strategies to stop and injury before it occurs. Keeping the workplace safe and clean, providing appropriate ergonomic or safety gear to employees, and conducting regular safety training can prevent employees from getting hurt on-the-job.
Sources:
Wikipedia - Workers Compensation Australia