what is workers compensation insurance

As an employer, there is a legal duty to deliver a working environment that is reasonably safe for employees. State legislation may require liability coverage in the event of an accident, but if not, many business owners may be wondering what is workers compensation insurance and how can it protect the company?

What Does It Cover?

If an employee is injured or harmed during the course of their work day or while on company time, compensation insurance will cover both the medical charges incurred and a portion of the wages lost due to temporary or long-term disability.

These insurance policies protect employees, but they also provide financial coverage for employers who may be exposed to a lawsuit resulting from an accident. Regardless of whose is at fault for the accident, tort liability presents an obligation on the part of the employer to assume responsibility for restitution.

How is it Offered?

Workers compensation insurance varies in price and where to purchase it. High risk or dangerous industries influence higher premiums, as do business locations, previous accident claims and the number of employees. A few states require purchasing a plan through state insurer options, while other states offer a state program but also allow for private company purchase.

When considering what is workers compensation insurance, think of it as financial protection for both employer and employee in the event of a workplace accident.

Coverage for Employee Accidents