Many of the insurance plans or policies that a company purchases are to protect the business. Workers Compensation insurance is specifically to protect the workers. Not only is it a good idea to protect your workers, but it’s also the law.
What is Workers Compensation Insurance
“Workers’ compensation is a form of insurance providing wage replacement and medical benefits to employees injured in the course of employment in exchange for mandatory relinquishment of the employee’s right to sue his or her employer for the tort of negligence.”
The five key benefits of Workers Compensation Insurance are:
- Medical costs due to injury or illness occurring while employee was on the job
- Payment of injured employee’s missed wages
- Provide necessary ongoing care for injured employee
- Covers legal costs if employee sues your company due to the injury
- Funeral costs and death benefits if employee dies due to a work related event
Why Workers Compensation Insurance is Needed
Workers compensation insurance protects both the employee and the employer. While the majority of companies are responsible and would compensate employees appropriately, there are quite a few that would not. Therefore, workers compensation is required by nearly every state. In California, not providing worker’s compensation insurance is a criminal offense and can result in a $10,000 fine and/or imprisonment up to one year.
Whether your business is large or small, or if you have employees, it is in the company’s best interest to get workers compensation insurance. Depending on your industry, it’s possible that some independent contractors that your company hires are deemed as employees. If you hire independent contractors and pay them by the hour, it is possible that the state could view them as an employee rather than a contractor.
To get a quote for workers compensation, fill out our free online quote form.