Worker’s compensation insurance is an insurance policy that provides partial wage replacement and medical benefits to employees who are injured on the job. The worker’s compensation system is different from personal injury law in that the injured worker does not have a right to sue his or her employer for damages.
Worker’s compensation laws vary by state, but in most states, workers who are injured on the job must file a worker’s comp claim and prove that their employer was negligent. In some states, employers are required to carry workers’ compensation insurance, while in others it is optional.
The purpose of worker’s compensation is to protect employees against injury or illness caused by their own actions at work (for example, falling off a ladder), as well as injuries resulting from other employees’ actions or from defective equipment or equipment failure. On the other hand, employee negligence resulting in an accident may not be covered by workers’ compensation insurance if it can be proven that the employee was acting outside of his or her scope of employment when injured.
Worker’s Comp vs. Health Insurance
Worker’s compensation insurance is not the same as employee health insurance benefits. Worker’s compensation insurance applies only to injuries that occur on the job and covers only workplace injuries, while employee health insurance covers both workplace injuries and illnesses. Worker’s compensation also requires that an employee report their injury within a specific timeframe after it occurs, while employee health care may not require this time limit.
Worker’s Comp for 1099 Independent Contractors
For independent contractors, worker’s compensation coverage is not usually required by state laws. However, even if an independent contractor doesn’t have an obligation to get coverage, he or she may still want to consider procuring it. Worker’s compensation protects the contractor against being sued by an employee if they are injured on the job. Without this coverage, an independent contractor could be personally liable for any damages related to workplace injuries.
In some cases, it may also be beneficial for a company hiring a contractor to require that he or she has worker’s compensation coverage in place. In this way, the company will be protected from liability as well.
Other Types of Insurance to Consider
In addition to worker’s compensation insurance, you should also consider other types of insurance. For example, if you have employees who drive your company car or their own personal car while they’re on the clock, you’ll want to make sure that they’re covered by an auto insurance policy that includes coverage for accidents with commercial vehicles. Getting a quote for commercial auto insurance is just as easy as getting a quote for workers’ compensation insurance—you can get one online in just 15 minutes.
As your business grows, keep in mind that the value of your liability coverage will likely increase. You may also want to think about other types of coverage like property insurance, directors and officers liability insurance, or umbrella liability coverage, especially if your business becomes more complex or has more assets to protect.
Worker’s compensation insurance is something you need to have for your business to help protect your workers, their families and your business. These individuals help facilitate the growth of your company. They help drive profits up and, unfortunately, they can also drive losses down by filing workers’ comp claims, so it’s important that you have adequate coverage in place should they become injured while on the job.
