Worker’s compensation insurance is designed to protect all parties in a business situation by covering the costs that could be incurred by an unlikely or unforeseen event relating to an accident or injury.
In order for worker’s compensation insurance to be an effective tool for your business, you must first understand the risks involved for your employees in carrying out daily work activities.
This is an understanding process that can be undertaken together with a professional risk profiler or simply be a document that is put together by your company to show awareness of the potential dangers and hazards in your workplace.
Worker’s compensation is mandatory in most states of the US to ensure that both workers and businesses remain protected at all times.
Pre-workers compensation times
Before workers comp insurance became a mandatory requirement for businesses in the US, workers could attempt to sue the business for medical costs and damages.
In many cases, the legal process was unsuccessful for the worker in question leaving injured people with a range of out-of-pocket medical expenses that they could not afford.
In the cases where workers were successful in suing the company, in some cases, the company would go bankrupt as a result of the required payout that needed to be made.
This was a toxic situation for all involved which was almost completely resolved by the introduction of mandatory worker’s compensation insurance policies.
How a worker’s compensation policy works
A worker’s comp policy is designed to protect the business from liability if an accident should occur in the workplace, no matter how the accident occurred.
It is no-fault insurance that pays for the injured party’s medical expenses in relation to injuries sustained in the workplace that are within the scope of their regular employment.
Holding this insurance is important for businesses as in most circumstances the policy protects the entity from further legal action which, in turn, protects the business from the sometimes irreparable financial damage that a claim like this would cause for any uninsured company.
Why choose a worker’s compensation policy?
Apart from this type of insurance being a legal requirement for most businesses, what worker’s compensation can offer to businesses both large and small, is complete peace of mind.
With quality insurance in place, business owners never have to worry about going out of business as a direct result of a workplace injury.
The reassurance that a worker’s comp policy offers is enough to ensure that both the business and its employees are taken care of in most unforeseen circumstances.
Though it may feel like an unnecessary business expense to some, the “it will never happen to me” mentality is a dangerous one to have.
Accidents happen every day and in the event of something injuring your employees or even causing death as a result of an injury in the workplace, you want to be sure that you can support your employees and their families as much as possible through the tough times that come after injuries have occurred.