Workers Comp Insurance Basics

 Workers Comp Insurance Basics


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Having Workers’ Compensation Insurance is mandatory in most US states. Workers' compensation insurance covers the employees if something happens to them on the job. To put it another way, it is basically a disability insurance policy for workers who are unable to work because of an injury or sickness they sustained while on the job.

It is the responsibility of employers to pay for this insurance, and the employee should not be expected to contribute. Workers' compensation insurance is a recurring cost for small businesses. It is the responsibility of the insurance company to offer workers' compensation payments if an employee is injured or ill while working.

One thing to consider here is your Workers Comp Experience Modification Rating (EMR). Workers' compensation and insurance claims are used to assess your EMR. An EMR worksheet is used to evaluate each claim, considering details including the nature of the occurrence and its monetary worth. Payroll size is another aspect that might influence your EMR. 

Benefits of Workers' Compensation Insurance

There are four types of benefits commonly received by injured employees that are relatively consistent throughout the country. These benefits consist primarily of the following:

  • Medical Benefits. When an injured worker obtains maximum medical improvement (MMI), medical expenses are normally reimbursed until further treatment does not improve their health. Possible medical costs include physical therapy, doctor's visits, medications, and more. 

  • Rehabilitation Benefits. Rehabilitation benefits must cover the cost of retraining for a person to return to work at a job that pays close to what they were making before.

  • Disability Benefits. Disabled workers are eligible for disability compensation in cases when they are unable to return to their jobs because of a work-related injury. Depending on the employee's ability to earn, the kind of impairment, and the state requirements, pay replacement might vary.

  • Death Benefits. A worker's spouse, small children, or elderly parents may be eligible for workers' compensation payments if the employee dies on the job. Death benefits in almost every state typically cover funeral and burial costs. In addition, they may be able to help compensate for earnings that have been lost.

How Much Does Workers' Compensation Cost?

For each $100 of payroll, your business will be charged in workers' compensation insurance premiums. Workers' compensation insurance costs around $1 for every $100 in payroll, according to the Hartford Insurance Company. Your premium is based on the type of work your employees do (classification rate), the number of claims the business has had in the past, and how much you pay your employees per $100.

 

How To File A Claim For Workers Compensation?

The employee must notify their employer of any work-related sickness or injury before filing a compensation claim. The employee must inform their employer of any work-related illness or injury.

  • Employers must tell their insurance company and any relevant state workers' compensation board. Workers' compensation claims involving significant injuries must also be reported to the federal agency responsible for workplace safety and health (OSHA).

  •  Additionally, the employee may be required to go before a board of workers' compensation to make their claim for benefits.

  •  An employer may also be required to notify their insurance carrier of a workers' compensation injury within a specific time frame.

  • Before you file a claim, you should find out a lot about how your state handles allegations and if there are any deadlines.


Companies must take the necessary precautions so that their workplaces are safe. Employees can only protect themselves on a certain level, but having insurance is that added protection and peace of mind for both the company and the employees. Feel free to search online or in your area for reputable insurance providers and get the protection you need.


 

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