Worker’s Compensation Insurance 101

Here’s everything you need to know about workers compensation insurance.

If you’re a business owner, then you probably know that you have to have workers compensation insurance for your employees.  But what is workers comp and how does it work?  If you’ve ever been curious about workers comp insurance, then here’s what you should know.

What is workers comp?

Workers compensation insurance is a type of policy that protects your employees if they are ever injured while on the job.  Generally, workers comp provides coverage for an employee’s medical costs and can provide coverage for lost wages, rehabilitation expenses, and disability benefits.  Additionally, workers comp can also cover your legal fees if an injured employee waives their coverage rights in favor of taking legal action against you.

Do I really need it?

Yes.  For starters, federal law requires that every employer offer their employees workers compensation insurance benefits.  Not having this type of coverage can put you at risk for heavy fines.  Additionally, offering workers comp benefits shows your employees that you are invested in their wellbeing and reassures them that they have a safety net should they be injured.  Finally, as previously mentioned, workers comp doesn’t just protect your employees.  This type of insurance also protects the business owner from lawsuits that could come from an injured employee.

Where do I get it?

Usually, workers compensation insurance needs to be purchased separately from other commercial liability and general business owners insurance policies.  Each state specifies whether the insurance comes from independent agencies or the state itself, so make sure you check your state’s regulations.  If your state allows you to purchase worker’s comp through an independent insurance company then make sure you have a top-rated provider with in-depth understanding of and experience working with workers compensation insurance.  For instance, companies like PMC Insurance Services can offer you the hassle-free assistance you need.

How are premiums calculated?

Your insurance premiums for workers comp are calculated based on the industry you are involved in and your business’s payroll.  Obviously, riskier work will translate to higher premiums, and more employees might also increase your rates.  Other risk factors that affect your premium include your business’s location and, in some cases, the claims history of your business in comparison to similar businesses.

Use this guide to help you uncover the mysteries of workers compensation insurance.  If you have clients looking to get the right workers comp insurance for their business, then turn to the team at PMC Insurance Services.  Our insurance experts can assist you with a wide variety of coverage options available to your clients.  Contact us for more information.

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