Understanding Small Businesses and Workers’ Comp Insurance

Accidents are unexpected events that can financially drain any business, large or small. As a small business owner, it is up to you to know your responsibilities toward your employees and how to mitigate the risk for your business. Workers’ Comp insurance is an excellent way to accomplish both goals simultaneously. As a mandated form of insurance coverage in most states, your first step is determining what you must do to comply.

Why Is Workers’ Comp Important?

Treating a work-related injury can be expensive and will fall directly on the business. A Workers’ Comp policy will pay for your employee’s medical costs and any lost wages they may incur while off work during their recovery. In states where Workers’ Comp is mandatory, you will need it to comply with the law.

What Injuries Are Covered?

Injuries sustained in an accident and injuries or illnesses that develop over time are covered by Workers’ Comp insurance. Many illnesses, like lung cancer, from regular exposure to carcinogens may take years to build. While providing a safe work environment is up to you, some illnesses or injuries are still possible.

What Is Covered Aside from Medical Expenses?

Workers’ Comp covers much more than an employee’s medical expenses. It also covers lost wages and rehabilitation costs. If an employee can no longer perform the tasks associated with their previous job, Workers’ Comp will also pay for training so they can return to work in another capacity. It will also pay a death benefit to survivors.

Limitations and Restrictions

Workers’ Comp does have limitations and restrictions in place. Some policies include coverage caps limiting the amount paid for your employee’s medical expenses. Injuries incurred while the employee was impaired by alcohol or illegal drugs will also not be covered. Self-inflicted injuries are also not covered. If an employee is involved in any type of criminal activity that results in an injury, they will not be covered.

Who Mandates Workers’ Comp Coverage?

Your state sets the requirements for Workers’ Comp coverage. They factor in your business’s risk, the number of employees that would be eligible, and what type of business you have.

Are Small Business Owners Required to Have Workers’ Comp Coverage?

The laws governing Workers’ Comp coverage for businesses will vary for each state. Talking to an insurance broker will help you determine whether or not you need to purchase Workers’ Comp coverage.

What Types of Employees Count Toward Workers’ Comp Coverage?

Independent contractors, seasonal workers, part-time employees, and business owners are generally exempt from coverage and are not counted as eligible employees when purchasing Workers’ Comp insurance.

The Cost of Workers’ Comp Coverage

The cost of Workers’ Comp coverage is determined by several factors, including the number of eligible employees and their work type.

Workers’ Comp Coverage with Premier Risk, LLC Is Best for Small Businesses

There are many types of Workers’ Comp coverage. It’s essential to work with a reputable insurance broker like Premier Risk, LLC, who can help identify your business’s needs. Our experts will be able to find the perfect Workers’ Comp policy for your company and its unique needs. Contact us today for further assistance.