When you’re a business owner, there are a lot of things to worry about. But one thing you don’t want to have to worry about is getting injured on the job. That’s where workers compensation insurance comes in.
You may not know it, but this type of coverage is a must by law for every business in most states in the U.S. If you are a small business owner and you don’t have this coverage yet, now is the time to get it.
What Is Workers’ Compensation Insurance?
Compensation insurance for workers is a type of insurance that provides benefits to employees who are injured or become ill as a result of their job. It can help cover medical expenses, lost wages, and other costs associated with an injury or illness. If you’re a business owner, it’s best to understand how this coverage works and whether your business needs it.
Who Needs It?
In most states, you are legally required to have workers’ compensation insurance if your business has employees. In a few states, you don’t have to purchase. But, it’s still a good idea for many reasons.
Businesses that have four or more employees – full-time or part-time – should have workers’ compensation coverage. You may be able to obtain an exemption from this requirement if all of your employees work fewer than 30 hours per week and earn less than $500 during any calendar quarter of the year. However, this is not true in every state. Check with your state department of labor for details about rules in your area.
Moreover, this coverage can help protect your business from lawsuits. Aside from that, it provide benefits to employees who succumb to injuries or become ill as a result of their job.
What Does Compensation Insurance for Workers Cover?
This may cover medical expenses, lost wages, and other costs associated with an injury or illness. It can further help cover the costs of rehabilitation for employees with injuries.
Medical expenses may include hospital bills, doctor’s bills, and the cost of prescription drugs. Lost wages may include the wages an employee loses while he or she is recovering from an injury illness. Other costs could include transportation costs if an employee can’t drive because of an on-the-job injury.
Retraining or rehabilitating an injured worker is sometimes necessary to help the worker return to work. If this happens, workers’ compensation insurance may cover the costs associated with retraining or rehabilitation.
What Constitutes Compensation Claims from Workers?
A workers’ compensation claim usually means that you have a workplace injury. Whether it’s a broken bone, a back injury, or something else. However, there are instances where illness as a result of your job could also qualify as a compensation claim. For example, if you get lung cancer from inhaling smoke and particles at work every day. In these situations, this type of insurance would provide benefits even if you’re no longer able to work.
What About Independent Contractors?
If you use independent contractors for your business, you may not need to purchase workers’ compensation insurance. But, it’s a good idea to check with your state department of labor to be sure. Independent contractors are not typically covered by workers’ compensation insurance. So if a third-party contractor gets an injury while working for you, he or she may not be able to receive benefits.
How Much Does Workers Compensation Insurance Cost?
The cost of workers’ compensation coverage varies depending on the size and type of your business, the number of employees, and other factors. You can expect to pay anywhere from $500 to $5,000 per year for coverage.
Other insurance companies charge on monthly basis, and the average cost is $80 per month. But take note that this is just the average cost. The actual price may vary according to several factors. This includes the type of business, payroll, and the state where you belong.
Can I Get a Discount?
You may be able to get a discount if you have a good safety record. Your insurance company may also offer discounts if you purchase coverage for several years at a time.
What Happens If I Don’t Have Workers’ Compensation Insurance?
If you don’t have compensation workers insurance and there is an injury while performing a job, the employee may be able to file a lawsuit against your business. This could result in expensive legal fees and other costs for your business.
In addition, the employee may be able to receive benefits from the state workers’ compensation program. So, it’s always best to err on the side of caution and purchase workers’ compensation insurance for your business.
The Bottom Line
Workers’ compensation insurance is important for any business with employees. It can help protect your business from lawsuits and provide benefits to employees who are injured or become ill as a result of their job. This coverage can also help cover the costs of retraining or rehabilitating an injured employee. If you’re a business owner, it’s important to understand how the coverage works and whether your business needs it. In most states, it is legally a must to have one if your business has employees.
However, even if you’re not required to have workers’ compensation insurance, it’s a good idea to have it. Workers’ compensation can help protect your business from lawsuits and provide benefits to employees who are injured or become ill as a result of their job. To find out more about how much workers’ compensation costs, contact us at Lopez Auto Insurance. We can help you find the right coverage for your business.