Worker’s Compensation Insurance: What Employers Need to Know

Worker's Compensation Insurance: What Employers Need to Know
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Introduction

Worker’s compensation insurance helps protect employers who are liable for workers who are injured on the job. It’s a type of insurance that provides full or partial reimbursement for medical care, lost wages and permanent disability benefits. In some states, employers are required to have worker’s compensation insurance. However, if your state doesn’t require it, there are still good reasons why you want to get coverage:

What is worker’s compensation insurance?

Worker’s compensation insurance is a form of insurance that protects employers from lawsuits by injured employees. If you’re an employer and you have workers who are injured on the job, worker’s compensation will pay their medical expenses and lost wages while they recover. If they aren’t injured, then it won’t pay anything at all–it only covers injuries caused by work-related activities.

Due to requirements in most states (and some federal laws), all employers must carry this type of coverage as part of their business insurance policy. In fact, if an employer doesn’t carry worker’s comp coverage and someone gets hurt while working for them, they could be held liable for medical bills or lost wages if they don’t provide adequate care for their injured employee.[1]

Who pays for worker’s compensation insurance?

Employers are responsible for paying the premiums, which are based on the size of the company and the type of work they do. The cost varies from state to state.

For example: If you have one employee working in New Jersey at an office building doing administrative work, your premium would be about $3 per month per employee (as opposed to manufacturing where premiums can run around $40).

How much does worker’s compensation insurance cost?

The cost of worker’s compensation insurance varies by company size, but generally speaking, the larger the company, the more it will pay in premiums. The average annual premium for a small business with fewer than 10 employees ranges from $1,000 to $5,000 per year; for medium-sized firms with between 11 and 50 employees, it’s around $6,000; and for large companies with 51 or more employees (including subsidiaries), it’s closer to $8 million annually.

In addition to these general numbers–which can vary widely based on factors like location and industry–your specific state may also influence your premium costs. For example: In California where I live now (and work at an insurance company), workers’ comp costs about 2% less than other states because there are fewer lawsuits against employers due to their strict laws regarding workplace safety

How long does a worker have to file a claim for worker’s compensation benefits?

There is a 180-day time limit for workers to file a claim for worker’s compensation benefits. If you don’t file within that timeframe, you won’t be able to receive any money from your employer or insurance company.

The only exception is if your injury was not discovered until after the 180 days had passed. In this case, you may still be able to receive benefits if they can prove that it took some time before their injuries were noticed (for example: someone who broke their arm but didn’t realize it until six months later).

What happens if an employer doesn’t have worker’s compensation insurance?

If you don’t have worker’s compensation insurance, there are a number of potential consequences. Your business could be sued by injured workers and their attorneys. You may also be fined or ordered to pay the injured employee’s medical bills and lost wages. In some cases, employers who don’t carry worker’s compensation insurance have been forced to shut down because they couldn’t afford the high cost of covering workers’ injuries on their own.

To ensure that you’re protected from these kinds of lawsuits and penalties–and to avoid losing business because customers won’t want to deal with an uninsured company–it’s important for every employer in Pennsylvania (and any other state) to carry appropriate coverage for its employees as soon as possible after hiring them

An employer should have worker’s compensation insurance to protect them from lawsuits.

  • Worker’s compensation insurance pays the medical bills and lost wages of an injured employee. This saves the company money because it doesn’t have to pay for its own insurance premiums, which are higher than those of a third-party insurer like State Farm or Allstate.
  • Worker’s compensation also covers temporary replacements for injured workers until they can return to work (if ever). If a worker is unable to return at all, then employers may be eligible for permanent disability benefits as well; however these benefits are generally much less generous than those offered by private disability insurers like AIG or Prudential Financial Inc..

Conclusion

An employer should have worker’s compensation insurance to protect them from lawsuits. It’s important that you understand all of the provisions in your state’s worker’s compensation laws and make sure that your business has coverage in place before an injury occurs.

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