If you own a business and you have employees working for you, you need workers’ comp insurance. It doesn’t matter whether you employ 5 or 500 people most states require employers to purchase workers’ comp insurance in order to protect workers from injury or illness on the job.
If one of your employees were to sustain an injury while working or fall ill due to a workplace exposure, compensation benefits would include medical expenses, lost wages, vocational rehabilitation, and worst-case scenario—death benefits. If the employee blames you for their injury and can prove you are liable, they may even sue you. As long as you have workers’ comp, your legal costs will be covered (This can include an attorney, legal fees, and any damages).
Penalties can be stiff if you fail to carry workers’ compensation insurance. Not only will you have to pay penalties to the state, but all expenses of the injured worker as well. Be aware also that under most state’s workers’ compensation laws, any uninsured contractor or subcontractor who does work for your company is considered an “employee.” Therefore, if they are injured they can make a claim against you. For example, say you hire a painter to paint your office and he accidently falls off a ladder and breaks his leg. That worker could be eligible for workers’ compensation benefits from your company.
One of the major advantages of workers’ comp insurance to an employer is it doesn’t have a set maximum dollar limit like other liability insurance policies. That means the insurance company is responsible for paying all the injured worker’s claims, no matter how much the amount.
Talk to our team of qualified agents to find out what you need to do to ensure your business is covered. You may need to extend your workers’ comp insurance if you send any employees on sales calls or training programs out of state. Typically, policies only cover occurrences within the state your business is located.
Tiffany Buczek is a freelance writer and licensed esthetician living in Southern CA.