According to the U.S. Small Business Administration, about 17 percent of businesses must carry workers’ compensation due to hiring at least one employee. Coverage can be customized to reflect your company size and workplace risks. Today, more than ever, it is important for businesses to let employees know that you care about their well-being. Here’s a quick guide to getting the right workers’ compensation coverage in NY.
Types of Workers’ Compensation Benefits
Businesses usually purchase commercial workers’ compensation insurance on an annual basis. Basic plans provide coverage for employees who are injured or become ill on the job. Here are the essential benefits usually included in a basic plan:
- Medical bills – Workers’ comp pays employees for hospital visits, treatment, and medication.
- Vocational rehabilitation – Coverage includes a back-to-work transition program.
- Disability – Workers can receive benefits if they’re unable to return to work.
- Death – Benefits are paid to family members if the worker dies on the job.
- Employer liability – The plan covers negligence as long as it’s unintended.
- Litigation costs – Workers’ comp pays legal fees if an employee files a lawsuit.
Workers’ Compensation in NY
It is interesting to note that workers’ comp began in the progressive era of the early twentieth century in New York. After a deadly factory fire in New York City, the state legislature mandated that all employers must compensate workers for on-the-job injuries.
Today, New York State allows all employees who work for a for-profit business to be eligible for workers’ comp insurance. Even most workers for non-profit organizations are covered. When an employee is injured at work, they must immediately notify their supervisor and seek medical treatment. Employees may file claims online using the C-3 form provided by the State Workers’ Compensation Board.
A New York workers’ comp policy covers three main areas: healthcare benefits, cash benefits, and travel expenses related to healthcare. The plan pays for all healthcare costs associated with the injury, including rehabilitation. The cash benefits pay up to two-thirds of the employee’s normal weekly wage. Be aware that businesses are not allowed to charge their employees for participation in coverage.
General Liability Vs. Workers’ Compensation Insurance
Commercial general liability (CGL) insurance differs from workers’ compensation coverage, although they both cover bodily injuries. CGL covers injuries to customers and visitors to your commercial property, while workers’ comp covers injuries to workers. Both policies provide essential benefits to employers, as the combination strengthens financial protection for legal expenses.
Some of the items that CGL plans cover include libel, slander, advertising injury, and intellectual property infringement. Sometimes a business can get sued by associating another company’s trademark with the brand without permission. If you post a picture online that includes a registered trademark of another company in the background, it can lead to legal challenges. Another easy way to get sued is if your blog starts lashing out at people who aren’t even public figures without supportive evidence.
Workers’ Compensation Insurance Requirements
Today most states require businesses to carry Workers’ Comp if they employ one or more individuals. Each state sets its own specific rules, so you need to be familiar with New York’s requirements. State rules apply to every operation within the state, not the company’s founding location or its headquarters outside the state. Some states may require businesses to buy a policy through the state fund. Aside from these requirements, the company is free to determine how much workers’ compensation coverage they should carry.
Do Business Owners Without Employees Need Workers’ Compensation?
If you own a business and don’t have any employees, you are not required to carry workers’ comp insurance. Private entrepreneurs are generally expected to invest in their own health plans. However, if your company employs at least one other person, you most likely need to carry workers’ comp unless you live in the few states that don’t require it. Some states have a threshold of three or more employees to require coverage.
One of the ways the policy helps small owners is that it not only pays medical expenses for injured workers but it also pays for their lost wages. The employee, however, must conduct work within the state. An All States endorsement can be added to the policy to account for out-of-state workers. Any time your business moves to another state, you must check that state’s business requirements.
How Much Does It Cost?
Rates that businesses pay for workers’ comp in NY are set by the New York Compensation Insurance Ratings Board (NYCIRB), which was founded in 1914. The NYCIRB sets rates for each business based on four factors: class code, location, payroll, and experience. Each of these factors is associated with business risks. In New York and other states with a high cost of living and high-income earners, you can expect to pay higher overall workers’ comp rates.
Although all businesses try to save money to maximize the returns of investments, workers’ comp is not an area to be neglected as cutting down on coverage may render it less effective in the event of an emergency or big lawsuit. Most successful business leaders consider workers’ comp to be necessary to maintain a stable workforce.
Where to Buy Workers’ Compensation Insurance in NY
While looking for workers’ compensation insurance in NY, remember that experience goes a long way. Contact our experts at Premier Risk, LLC for more information about protecting your business and your staff with appropriate workers’ comp insurance.