Recently a concerning trend has emerged among businesses, particularly in small enterprise. Certain companies are opting to go without workers’ compensation. Not only is this troubling due to legal requirements to carry the coverage, but also for the fact that workers are entitled to the benefits, whether coverage is provided or not.
All states have workers’ compensation laws that require companies provide medical expense reimbursements and other benefits to employees who fall victim to a workplace injury or illness. Workers’ compensation is a foundational component of employee benefits packages. One might even argue a moral obligation exists to carry the coverage. Here are some reasons why workers’ compensation is important, no matter the size of business.
One might even argue a moral obligation exists to carry the coverage.”
It is Required
As stated, plain and simple. And even though workers’ compensation requirements differ by state, they all generally require similar benefits such as medical expenses and lost wages for as long as needed by the injury. Many states today necessitate coverage upon hiring the first employee. It is important for business owners to understand their obligations for each state in which they operate. The NFIB publishes an informative workers compensation law state-by-state comparison we encourage you to review.
It is also important to note that some states, namely Texas, allow employers to opt out of workers compensation insurance. However, employers without coverage can still be held liable in civil court. In other words, opting out of workers compensation insurance does not opt out of liability.
Workers’ Compensation Protects Employees
Work environments differ in the risk posed to employees. Office workers are exposed to very few threats in comparison to roofing contractors or coal miners. However, no environment is risk free. We even had an employee in our office trip over a chair leg which prompted a claim. Another had repetitive motion problems as a result of working behind a computer for decades. So, no matter the risk level, workers’ compensation is a safety net for every workplace.
An often-overlooked hazard is illness a result of the workplace. Silicosis, asthma, and asbestosis are lung diseases often linked to work environments. Operate a pet supply store that also offers grooming? Asthma related issues might be a higher risk than dog bites. These lung diseases represent only a portion of the illnesses that can be caused based upon vocation. Having workers’ compensation provides employee protection should other measures fail.
It Protects Your Business
Without workers compensation coverage, employees are forced to sue your business to collect due compensation. If the injury is work-related, law makes the employer liable and most cases are settled in favor of the employee.
With workers compensation insurance in place, an employee’s sole recourse is against the insurance policy. Thus, businesses avoid the cost of medical expenses and lost wages. One of our clients had a workers’ compensation claim of $2,500,000 against their policy. Without workers’ compensation, they would have been forced into bankruptcy. The importance of this first-line coverage cannot be overstated.
Bankers Insurance provides access to loss control services that can reduce costly claims and keep premiums at a manageable level. For more information, contact your Bankers Insurance agent. Not a client of ours? Let us compete for your business. Each client is assigned a personal agent in our office, given their email address, and provided a phone number that rings right on their desk.
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