Protecting Your Business: The Essential Workers’ Compensation Guide

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Operating a business is fraught with risks, including injuries sustained by your workers. According to the Bureau of Labor Statistics (BLS), there are 3.4 workers’ compensation claims filed every year for every 100 full-time workers. 

Many business owners and managers of “white collar” businesses believe their companies have a minimal risk of serious injury to their employees. However, they often don’t consider their salespeople and service technicians out on the road, where the costliest workers’ compensation claims originate ($85,000 per claim average per vehicle accident, according to the National Council on Compensation Insurance).

This underscores the importance of all businesses taking preventive measures by ensuring the safety of their employees and having workers’ compensation coverage in place.


What is Worker’s Compensation?

Workers’ compensation is insurance that financially protects employees injured while working. It pays for medical costs and lost wages due to:

  • Disability caused by an injury on the job
  • Work-related illness
  • Death related to employment

Workers’ compensation does not cover lost wages or medical costs due to natural illnesses such as the flu, pneumonia, or COVID-19. Medical and disability insurance would come into play with these and other illnesses that didn’t originate on the job.

As you’re well aware, you pay premiums to the insurer providing your workers’ comp, which also helps fund rehabilitative services such as:

  • Physical therapy
  • Prescription medications
  • Prosthetics
  • Vocational training
  • Retraining programs

Why You Need Workers’ Compensation Insurance

Workers’ compensation insurance protects three parties or entities: your employees, your business, and you.

It protects employees from financial hardship due to work-related injuries and illnesses. It also protects your business, staff, and you from liability stemming from an injured employee claiming negligence.

Workers’ compensation provides peace of mind knowing that no employee, including yourself, can be held personally liable for a co-worker/s getting injured or becoming ill from workplace activities.

Do Your Research Before You Buy

Before selecting a carrier and workers’ comp policy, it’s vital that you understand the state and federal requirements affecting your industry, which may vary by location. In addition, if you are self-employed or pay independent contractors, check into specialized coverage options for your business.

The importance of an experienced insurance broker can’t be understated. They can help you analyze insurers and the different coverages available to you. They can also help you shop for an affordable premium, though this shouldn’t be your sole reason for selecting an insurer.

Some states do not require employers to carry workers’ compensation insurance, but be aware of how much a single large or class-action lawsuit could cost you. Having employees and going without workers comp is a huge risk and should be carefully considered.

Know What’s Covered and Let Your Employees Know

According to the BLS, most workers’ compensation claims are filed on Mondays, which is known as the “Monday effect.” This happens because employees file claims for injuries suffered over the weekend, erroneously or intentionally. 

By explaining your company’s workers’ comp coverage, you can prevent this and save yourself and your employees considerable time and aggravation. If you have an employee handbook, put coverage details in there. If you don’t, have company-wide or departmental meetings detailing the coverage.

Bottom Line Concepts is Here to Help

If you have questions about workers’ compensation, feel free to call Bottom Line Concepts. If we don’t have the answer, we’ll steer you in the right direction.

Also, ask us for information about the Employee Retention Credit (ERC) program. We’ve helped over 23,500 businesses recover over $4 billion they were legally owed for operating during the pandemic. We’ll help determine if you qualify and explain the process to file your claim with the IRS.

Schedule your free ERC introduction call today.

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