Worker Compensation: Do You Really Need Worker's Compensation Insurance?
In a word, yes. Worker's compensation insurance is an exceedingly important insurance component for virtually every company that exists in America today. It was initially designed and put into law solely to protect a business employer from being sued in the event an employee should become injured or sick due to his or her work environment.
Because of the critical safety net worker's compensation insurance provides, there is virtually no business that exists with more than two employees that does not provide worker's compensation.
But don't be lulled into a sense of false security. Worker's compensation does provide employees with some medical and financial benefits if they are injured, but you must still take the necessary steps to safeguard your business. This insurance is not only required by law in most states, but it is also one of the most important business safeguards you can buy.
Why You Need Worker's Compensation Insurance:
-Protection From Lawsuits. By law, when a person accepts a position accompanied by worker's compensation insurance, the individual is in effect saying that they are willing to accept the benefits provided by insurance in lieu of being able to sue their employer for either injury or illness resulting from their work environment. While some states allow for an employee to sign off of worker's compensation, few companies accept this since it would leave them wide open to phenomenally large liability suits.
-Employee Wage Protection. From a worker's standpoint, worker's compensation provides at least some level of protection in the event they suffer a job-related accident or illness. In most states, worker's compensation insurance will pay a disabled employee approximately 50% of their lost wages for a set number of weeks, generally not to exceed six months, which is when social security disability benefits would kick in.
Medical Compensation. Benefits are regulated by each individual state, but other possible benefits range from payment of medical bills to a financial award or settlement for either a partial disability (i.e. loss of one hand, limb or eye) or a permanent disability, such as blindness.
While you may not want to deal with the upfront costs and paperwork, the protection worker's compensation insurance provides both your company and your employees far outweighs the cost.
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