Every workplace has its share of risks and dangers. Even if your business operates out of an office, your employees can sustain injuries at work you can be liable for. For example, there were 2.7 million non-fatal workplace injuries and illnesses reported in 2020.
Your business, large or small, must reduce the risks your employees face every day. If an accident occurs, your business should be prepared to help employees and their families. Workers’ comp insurance can ensure your employees and your business are covered.
What is workers’ comp insurance, and does your business have to carry it? Read on to learn more about workers’ comp policies.
What Is Workers’ Comp Insurance?
Workers’ compensation insurance is coverage you buy as a business owner to provide benefits to your employees if they are sick or injured on the job. So if an employee slips and falls at work, workers’ comp will cover their medical bills and lost wages while away.
Many states require business owners who have employees to carry workers’ comp insurance. States may also require you to carry insurance if you are self-employed or for 1099 contract employees. You will have to check the laws in your state to determine when and if insurance is necessary.
Benefits of Workers’ Comp Insurance
Although many states require business owners to provide workers’ comp for their employees, there are several reasons to have it even if it’s not mandated.
Workers’ comp can provide you and your employees with the peace of mind that their injuries will be covered if something happens to them while on the job. Not all health insurance covers these injuries, so your employees will appreciate you looking out for them.
Workers’ compensation insurance can also protect your company from a costly lawsuit. Without workers’ comp insurance, you will have to pay out of pocket to cover your employee’s injuries if you are liable.
How Much Is Workers’ Comp Insurance?
Workers’ compensation policies vary in price depending on how many employees you have and your industry. Your premiums will be higher if your business is in a dangerous industry or you have more employees. These policies mean you need to know the number of employees your business will have that year to determine your premium payments.
Some workers’ comp policies allow you to pay as you go. Your business pays for each employee every payroll cycle in these policies. As a result, your business can pay for the exact coverage you need.
Workers’ Comp Policies
Workers’ comp policies provide a range of benefits, including covering medical bills, covering salary, and giving family members compensation if an employee is fatally injured. The insurance can cover many types of injuries as long as they are work-related. Employees can be covered for illnesses they may get on the job and for injuries caused by extended overuse.
Although these policies can cover a lot, they have limitations and restrictions on when employees can receive compensation. For example, they won’t cover your employees when injured due to not following company policies or self-inflicted injuries.
Protect Your Business Today
Workers’ comp insurance rules vary by state, so it’s important to look up the laws in your state to determine when your business needs to buy coverage. Failing to cover your employees can cost your business fines and lawsuits. So take steps to ensure your workers’ comp needs are met.
Are you interested in learning more about the coverage you need for your employees or other business laws? Check out the business section of our website for more guides like this one.