Workplace environments are designed to ensure employee safety and security. Still, accidents are inevitable and injury or illness can happen at any second.
Having workers’ compensation insurance provides protection for employees and also offers support to the employer from legal issues.
So what does workers’ comp insurance cover, and why is it so important to have?
Here’s everything your small business needs to know so you are fully prepared for unanticipated setbacks.
The Insurance Information Institute defines workers’ comp insurance as a “type of coverage that provides medical support and financial assistance to employees in the event of an accident.”
Workers’ comp benefits provide employees the right amount of medical care for their work-related injuries, as well as help with medical expenses and income for lost wages until they can return to work.
But workers’ comp insurance isn’t just for employees - it’s for the business owners, too.
Employers are protected from potential lawsuits with workers’ comp insurance coverage. If an employee makes a workers’ comp claim that says the work environment is unsafe and unstable, workers’ comp insurance helps business owners handle risk and damage costs.
Injuries that are considered under a workers’ comp insurance plan must happen while employees are on the clock. For example, if an employee gets into a car accident while delivering a product, they are covered by workers’ comp coverage.
In this sense, the incident doesn’t necessarily have to happen at the job, but on the job. Workers comp covers the employee while he or she is pursuing “course and scope” of their job.
Technically, most states only require employers to have workers’ compensation insurance if they have employees who don’t own a portion of the business. This means if you’re a small business owner without employees, you don’t have to buy a coverage plan for yourself.
As soon as you hire someone, however, you have to explore your options.
If you have contract employees, you may even consider talking to them about workmans' comp insurance for contractors.
This is an extra layer of protection for business owners who don’t want to worry about potential liability issues if an independent contractor brings you into a lawsuit. Some form of liability insurance or business insurance is suggested, even if you consider your company small.
Kickstand Insurance can help. Get an instant quote today to better protect your employees and save your business money.
Mordechai Kamenetsky, co-founder and lead agent of Kickstand, is recognized as an expert in workers' compensation. He is passionate about helping small businesses manage risks and lower their workers' comp costs. In his articles, he educates readers and clients on the intricacies of workers' comp insurance.