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Workers Compensation and Employers
Today's Workers Compensation and Employers
Liability Insurance Policy was developed
by the National Council on Compensation Insurance (NCCI) and covers the insured's
statutory liability under the various state workers compensation laws or acts.
Workers' compensation, also known as workers comp is insurance coverage required by
state laws. It
is designed to provide
compensation for workers who are injured on
the job in the course of their employment. Work Comp insurance is always paid for by
Workers Compensation is based on a system by which no-fault statutory benefits
prescribed in state law are provided by an employer to an employee (or the
employee's family) due to a job-related injury (including death) resulting from an
accident or occupational disease
The true benefit for carrying workers compensation insurance is that the laws
strictly prohibit employees from suing their employers for any claims or any
negligence if a policy is in force during the claim.
While plans do vary between states, work comp insurance generally covers the
Workers' compensation is a form of insurance, paid by employers, providing wage
replacement and medical benefits to employees who are injured during the course of
working for the insured. The employee does not have the right to sue the employer
for any tort negligence when an employer purchases coverage. The system is known as
the compensation bargain because it protects and limits both parties in terms of
legal recourse from injuries.
Business owners in some states are not required to buy workers compensation
insurance. State rules are typically based on the type of business entity you have
(sole-proprietorship, partnership, LLC, corporation) and your total number of
part-time and full-time employees. In most states, one or more employee will trigger
coverage requirements. Visit our state pages
for specific regulations in your state.
In several other states, owners are required to carry workers' compensation coverage
even if they don't have employees. Many owners end up spending more money for
coverage when they purchase a standard policy. Individual owners with no employees
may benefit from buying a workers
ghost policy instead of a traditional
Employers liability coverage is provided by Part 2 of the basic workers compensation
policy. It pays on behalf of the insured (employer) all sums that the insured shall
become legally obligated to pay as damages because of bodily injury by accident or
disease sustained by any employee of the insured arising out of and in the course of
his employment by the insured.
Employers liability insurance covers employers who may be liable, if, through their
negligence, employees have been injured. Workers Compensation pays the worker
whether the employer has been negligent or not. Any injury must be injured or suffer
an occupational disease in the course of employment.
Each state has their own specific rules and laws regarding workers compensation
coverage and employers liability. Employers liability coverage is part of every
insurance policy except the four remaining states where the state's workers'
compensation system is managed under a monopolistic system. Employers liability can
typically be added to an employer's general liability policy in monopolistic states.