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Workers’ Compensation Insurance: How Does it Work?

Workers’ compensation insurance protects your business by covering employees for work-related injuries and illnesses. It often prevents an employee from suing for work-related damages by covering medical care and lost wages. This coverage also pays a deceased worker’s family a death benefit. If the family sues, workers’ compensation pays for legal fees. There are state workers’ comp regulations that your business must be compliant with as well.

Workers compensation premiums vary according to the size of the business and the risk involved in the type of work performed by employees. If yours is a risky business that you have a hard time getting insured, most states have their own assigned-risk workers’ compensation insurance programs with a special fund.

Workers’ compensation was created to eliminate lawsuits. If an employee uses this benefit, they usually forgo filing charges against the employer.

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