Workers compensation offers compensation for accidents when an employee is hurt on the job. It can cover a lot of injuries and accidents resulting in injury, disability and even death. But even workers compensation doesn’t cover everything.
Workers compensation won’t cover:
- Emotional injuries
- Intentional/self-inflicted injuries
- Pre-existing conditions (with exceptions)
- Injuries obtained while the employee is under the influence of drugs or alcohol
- Injuries obtained due to a fight the employee caused
- Injuries obtained offsite, including driving to and from work
Pre-existing conditions may be covered under some exceptions. If work conditions or an accident worsens pre-existing conditions, workers compensation may provide compensation. Emotional injuries are only applicable if they come with a physical work injury. Keep in mind that workers compensation is a no-fault coverage, meaning that it doesn’t matter who caused the injury. If the employee’s own negligence or mistake caused the injury at work, they may still be covered beneath workers compensation.
What Does Workers Compensation Cover?
Now that it’s clear what workers compensation doesn’t cover, it’s a matter of understanding what it does cover. Workers compensation covers:
- Injuries sustained on the job
- Injuries sustained through the course of a normal workday
- Stress and strain
- Worsening pre-existing conditions (such as carpal tunnel syndrome)
- Illnesses obtained through work (for example, employees contracting illnesses from working with harsh chemicals or in buildings with asbestos)
While most businesses are legally required to carry workers compensation, it’s important to understand whether you are covered. Certain contractors or volunteers likely won’t be covered under a company’s workers compensation insurance.
Employees may receive medical expense compensation and wage-loss benefits through workers compensation.
How Does Workers Compensation Work?
If an employee is injured during work, they should notify their employer and seek medical assistance immediately. After notifying their employer, the employer should document every part of the incident including the time, location and cause and take pictures of the injury and accident site. Move other employees away from the risk area. The employer should then contact the carrier that provides the company’s workers compensation insurance to file a claim. The claim will be investigated before compensation will be offered to the injured or ill employee.
Does My LLC Need Workers Compensation?
LLCs often have unique needs, but no matter whether you have one employee or fifty, you’ll need workers compensation. Workers compensation is legally required for any business with employees.
It is the employer’s responsibility to purchase workers compensation. States have different mandates for workers compensation and punishments for employers who do not provide workers compensation for their employees. Some states have a state fund for workers compensation where an employer must purchase workers compensation. These states are North Dakota, Washington, Wyoming and Ohio. State funded workers compensation does not cover employer’s liability insurance. If you must purchase state funded workers compensation, you should also purchase stop gap coverage to make up for the lack of employer’s liability insurance.
How Much Money Can I Get for Workers Compensation?
The amount workers’ compensation pays for medical expenses depends on your state and extent of the injury and will be offered when you must pay for treatment. For a workers’ compensation claim to provide weekly wage replacement benefits, you must be unable to return to work for a temporary or permanent amount of time. For temporary total disability, you may receive around 66% of your average wages. For total permanent disability, employees may receive a life pension. This occurs if the employee is unable to work due to a work-related injury. Payments for life pension through workers compensation are paid periodically at a percentage of your initial wages.
Also Read: Fifteen Essential Types of Business Insurance