Why is workers’ compensation so essential and why is it such a hotly debated issue in the workplace? Many entrepreneurs consider this an unnecessary expense. But this type of insurance provides essential protection for employers and employees.
Why Workers’ Compensation is Essential for Business Owners
Workers’ compensation is mandatory in most states in the U.S. There are jurisdictions in which employers could opt not to get insurance if they have no more than three employees. Even so, your clients may still want to get workers’ comp for the added protection it provides. These include:
Exclusive Remedy
When an employee suffers an injury, workers’ compensation is the sole legal remedy. It means they can’t sue the employer even if work conditions cause the injury.
No-Fault Coverage
No-fault coverage means that employees are covered regardless of the cause or nature of the incident. Even if the employee in question were partly at fault, they would still receive coverage for their medical expenses and lost expenses if they suffered the injury during work hours, on company premises, and while carrying out their duties.
Why Workers’ Compensation is Essential for Employer Coverage
Workers’ compensation also protects business owners if they suffer workplace injuries. Like their employees, they will receive compensation for their injuries, and the insurer will reimburse their lost income. They could even get disability benefits, which can be helpful if they cannot work due to their injuries.
The Downsides of Not Getting Workers’ Comp
So far, we’ve discussed how getting workers’ comp can benefit employers. But opting not to get insurance can also be detrimental to them. Your clients could be subject to penalties and legal consequences if they don’t purchase workers’ compensation, including:
Fines: In some states, employers may be subject to fines for refusing or neglecting to get workers’ comp coverage. These are usually computed daily, so it could eventually cost them thousands of dollars.
Penalties: Businesses could be subject to closure or prevented from operating if they do not have workers’ compensation. Courts may order the business to remain closed until the employer shows proof of coverage.
Personal Liability: Employers that refuse or neglect to get workers’ comp could be personally liable for paying their injured employees’ medical expenses. They may also pay their workers’ lost wages out of pocket.
Loss of Exclusive Remedy: We mentioned previously that workers’ comp serves as an injured employee’s exclusive remedy for compensation. Employers may deny this if they do not have workers’ comp.
Getting workers’ compensation is essential for employers and employees. Business owners can protect their businesses against liability by purchasing insurance even if they have the option not to do so.
About InsureMyWorkComp
InsureMyWorkComp is a digital brokerage that helps clients find the right workers’ compensation solution for their business needs. Unlike other online platforms, we will help you to work with an agent who can provide you the right solution for your risk profile. Our staff has over 50 years of workers’ compensation underwriting and sales experience, and we are confident that we will provide you the support that you need. For more information or to get a quote, contact us today at (855) 340-9138.