Why Every Business Should Offer Workers Compensation Insurance
Protecting yourself and your employees by investing in workers’ compensation insurance isn’t only a wise business decision, but it’s also mandatory in most states. Employers aren’t just responsible for establishing a safe workplace for their employees, they also have to be ready in case an employee is injured. One way to prepare is to enroll in workers’ compensation insurance. If you are considering opening your own business, or you already have a business but don’t offer workers’ compensation.
This article will tell you why you should provide this type of insurance for employees. But first, let’s take a look at what workers’ compensation entails.
What Is Workers’ Compensation Insurance?
There is always a chance that your employees can be injured in the workplace. When that happens, the employee could be out of work for a period of time. Workers’ compensation— also known as workers’ comp— covers a worker’s medical expenses as well as their lost wages. It also provides compensation for the families of workers who are victims of fatal accidents on the job.
This type of insurance is meant to protect both the employee and the employer. An employee has the right to file for a claim if an injury or illness is sustained within the workplace. It also covers incidents that are work-related, such as a car accident on the way to or from work. It is known that some industries are more hazardous, but any employee is at risk, regardless of the industry they work in. In all cases that are covered by this particular type of insurance, workers have a right to receive compensation for their injuries and subsequent loss of income. Most common claims happen as a result of operating machinery, slips and falls, medical malpractice, faulty products, vehicle accidents, among others.
It’s the Law
With the exception of very few states, providing workers’ comp insurance is mandated by law. Some states require you to have workers’ compensation depending on how many employees your company has. But the majority of states make it a requirement even if you have only 1 employee. For instance, according to Oklahoma’s workers compensation law, insurance is mandatory in the state of Oklahoma, even if you only have one employee. Some workers and employees are excluded from this law, such as part-time employees or independent contractors. To know which employees are exempted, you need to check the laws of your particular state.
As an employer, you have a legal responsibility to protect your employees. Each state has its own laws when it comes to determining the amount of coverage you need to get. These laws, along with the insurance agency, dictate the amount of compensation that is due, the statute of limitations when filing a claim, which employees are covered, and various other regulations.
An employer who doesn’t provide workers comp may find themselves getting sued in civil court by an employee who was injured. Filing a lawsuit can be an employee’s only legal recourse if their employer does not offer workers comp insurance. Some states are more employer-friendly and than others, like Georgia, for example. The specialized attorneys at https://www.thechampionfirm.com/personal-injury-lawyer/ in Atlanta advise that if an insurance company approaches an injured employee to sign a settlement, the employee should have it reviewed by a personal injury lawyer and never sign anything before doing so. This is because the settlement might not be fair. Considering that there are several types of injuries, each injury is an individual case; there is no one-size-fits-all settlement.
Avoid Severe Financial Losses
Even a minor injury of an employee can cost your business a lot of money, and the situation becomes much worse if the employee decides to sue. The insurance policy is put in place to protect the business owner as well as the employees. When an employer is uninsured, they risk great financial losses as they will have to pay the employee compensation for their injuries out-of-pocket. Most financial losses can be avoidable when you protect your employees, and yourself, with insurance.
Avoid Legal penalties
Even if an employee doesn’t take their employer to court, the employer could still face other kinds of charges and will have to pay hefty fees for not providing workers compensation. Employers could even face jail time for not complying with the law. Without workers’ compensation insurance, a business could be subject to grave legal repercussions.
Even if an employer tries to skimp on workers’ comp, the law will eventually catch up with them. The cost of insurance will be worth it down the road as it protects the employees and workers from the painful consequences of workplace injuries. Moreover, it can also save you, the employer, a substantial amount of money in legal fees.