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Workers’ comp protects a business from unexpected hazards or accidents. The insurance pays for medical costs and other liabilities. It has prevented a loss in money for many companies, allowing them to carry on and flourish. Knowing everything about workers’ compensation can help you prepare in case you encounter it in the future.
What Is Workers’ Compensation?
Workers’ comp is an insurance program required by almost all states. It provides insurance to injured workers for injuries and illnesses that occur on the job. Employees gain the medical care needed without needing payment for treatment. Employers also protect their liquidity from sudden costs. Some states use workers’ comp to lessen the financial impact if the worker passes away. It also applies if an injury leaves the worker permanently disabled.
Texas is the only state that does not require its businesses to have workers’ comp. Other states require it when a company reaches an employee threshold. The payment differs depending on several factors, including:
- Nature of business
- Number of employees
- Safety record
- Payroll size
For example, construction companies may need to pay a higher amount due to the greater risk involved in the job. Other workers have exclusion from coverage, including seasonal, temporary, and freelance workers. Depending on the state, other workers may also be exempt from receiving workers’ comp.
Workers’ comp is a no-fault insurance program. It means that when there is a claim for it, the employee cannot sue the employer for the injuries. The positive side of this is that the employee won’t have to go through the traditional tedious route of proving negligence.
Employee Injury Coverage
Workers compensation covers employee injuries that occur while on the job. For example, a slip and fall injury or a car accident can both get coverage. There just needs to be proof that the accident occurred during a work-related trip. Workers going to and from work do not gain coverage. Coverage of ailments and illnesses must be the result of repeated issues caused by work.
Workers’ compensation is necessary for companies that handle equipment that could cause injury.
According to data, 32% of all injury claims come from handling objects or substances. The next top reported injuries are slips and falls at 16 percent.
For example, a person develops carpal tunnel due to constant use of his hands on the computer while at work. Those exposed to toxic substances that develop illnesses also gain coverage.
Another common claim is back injury caused by repetitive movement like constant carrying of heavy loads. While these are all valid, there are also ways that the claim gets disqualified. The insurance will not provide coverage if:
- Tests reveal alcohol or drug use, proving that the person was under the influence.
- The worker was violating a company policy or law at the time.
- The injury occurred while the worker was away from the job.
- Self-inflicted injuries.
Aside from the immediate medical treatment, workers’ comp can also cover any future treatment related to the case.
For example, workers comp claims cover rehabilitation after a serious injury, which is common. The insurance also covers lost wages and other related costs.
Claiming Workers’ Compensation
If a worker suffers an injury while on the job, chances are you will need to file a claim.
The injury needs filing as early as possible to gain compensation.
The employee will report the injury to their employer and submit a specific form. The employer then handles the rest by completing necessary documentation and submitting these documents to the insurance company if the business is self-insured.
Alternatively, the employer submits it to the state workers’ compensation agency.
In most cases, the employer will need to communicate with the agency and the insurance company to notify both. Afterward, the employer will then wait for results. Once approved, coverage begins. In the case where there is a denial, the employer or employee can appeal the decision.
Preventing Injuries And Lawsuits
While work-related injuries are sometimes unavoidable, the employer can forewarn employees to try and prevent any mishaps. Holding safety initiatives and programs spreads the word about practices that reduce the risk of injury. The employer should also maintain a safe environment and good relationships between employees. Here are some things employers can do to lessen cases:
- Conduct safety training: Reinforce proper conduct and build safety habits for your employees. You must give refreshers on the proper use of equipment.
- Be transparent: Remind workers that compensation benefits are available. You can give them a refresher so they know what to do in case of an injury.
- Have an open-door policy: Let your workers know that they can talk about any problem or issue they encounter. It helps bring awareness to risks and hazards you may not be aware of.
What To Do While an Employee Is Out of Work
An injured employee can hurt a business. The lack of manpower also leads to lost time, revenue, and many other impediments. While an employee is undergoing treatment to get better, employers can take the necessary steps to ensure that his/her work has coverage. Here are some steps one can do:
- Hire a temporary worker: A temporary worker is not taxing on business resources. They are often skilled enough to pick up on the work left behind. Since the workers’ comp covers the wages of the injured employee, the employer can use the extra resources to pay for the temp in the meantime.
- Create a return to work program: A return to work program eases the injured employee back into his/her position. You can modify duties to help get them back to the job faster.
In the case of a permanent injury, workers’ comp will cover the disability benefits. If the employee fully recovers and gets back to work, he/she will inform the employer, which reports to all parties.
Avoid Insurance Fraud
Many cases should’ve received coverage from workers’ comp, but there was no report. It could be due to employers misclassifying employees or underreporting the numbers to avoid paying. Upon discovery of these practices, the business will receive heavy fines.
For employees, they should not fake an injury or try to double claim. An example of this is using social security disability benefits and workers’ comp at the same time. If investigators discover fraud, a stoppage of coverage for all treatments ensues.
With all of this, the best practice is to keep complete records and reports. Employers should share information with employees, and documents need prompt submission. It ensures that employers can claim workers’ comp without any issue.
Get Workers’ Compensation for Your Business
All Choice Insurance helps businesses by providing them the security of coverage in case of unwanted events. Aside from workers’ insurance, the company also handles business insurance. If you need any help regarding the pricing and coverage, ALLCHOICE can help!