Real Experts- Trusted
What are workers comp laws supposed to do?
In the United States, most employees who are injured on the job have an absolute right to medical care for any on-the-job
injury. In most cases, they will also be entitled to monetary payments to compensate
for temporary or permanent disabilities. Most employers are required to subscribe to
(purchase) insurance for workers' compensation, and there may be financial penalties
imposed for failure to comply with state laws.
Workers' compensation laws are rules of conduct or actions prescribed and enforced by a controlling state authority to govern
employer-employee relations in handling occupational disabilities or claims. All states,
the District of Columbia, and the U.S. territories have enacted workers compensation
laws. Additionally, Federal workers compensation laws apply to certain federal employees.
Workers compensation laws were enacted to reduce the need for litigation, and to mitigate the requirement that injured workers
prove their injuries were their employer's "fault". Every state has enacted some kind
of workers' compensation program or act. Such schemes were originally known as "workman's
compensation insurance," but today, most jurisdictions have adopted the term "workers'
In many states, there are public uninsured employer funds designed to pay benefits to workers employed by companies who illegally
fail to purchase workers comp insurance. Generally speaking, workman's comp insurance
policies are available to employers through private commercial insurance companies, or
state-controlled carriers. If the employer is deemed an excessive risk to insure by a
standard market carrier, it can obtain coverage through an assigned-risk program or state
In most states, workers compensation is solely provided by private insurance companies. However, some states operate a
state fund program (similar model to private insurers and often insures state employees).
There are a few states that operate a state-owned monopoly which prevents other carriers
from offering coverage in the state. Learn more about
workers compensation laws in your state
In order to keep the state funds from directly competing with private insurers, most state funds are generally required to
assigned-risk programs, otherwise knows as the carrier of last resort. Often times,
assigned risk carriers only write workers' compensation policies if a standard market
or private insurance carrier is not willing to offer a quote for coverage. In contrast,
private insurance carriers can turn away the worst risks and many can also write comprehensive
insurance packages covering general liability, auto, etc.
While many state insurance directors communicate with other insurance departments and, often times, model their insurance
regulations in a similar fashion, the biggest differences often come down to when and
how the rules apply to an employer. Some of the most common difference include:
Each state's insurance department is responsible for establishing laws regarding coverage in their state. Most states make
changes to some rules each year, including: approved insurance rates, minimum and maximum
payroll for owners, disability payments and benefit pay-out schedules. Other, more general
rules, don't change very often.
It is illegal in most states for an employer to terminate or refuse to hire an employee for having reported a workplace injury
or for filing a workers' compensation claim. However, it is often not easy to prove discrimination
on the basis of the employee's claims history. To avoid discrimination of this type,
some states have created a "subsequent injury trust fund" which will reimburse insurers
for benefits paid to workers who suffer aggravation or recurrence of a compensable work
comp injury. It is also suggested that laws should be made to prohibit inclusion of claims
history in databases or to make it anonymous.
Employees may not falsely claim benefits. There have been many instances where videos recorded by private investigators show
employees engaging in sports or other strenuous physical activities, although the employees
allegedly suffered disability or injury. Such evidence may not be admissible at a trial
if it is found that the taping infringed on the employees' reasonable expectation of
Call One of our Workers' Comp Specialists at 888-611-7467, or
Find your best workers compensation quotes. It takes 3 minutes.
Employers have the right contest employee claims for workers' compensation payments. In any contested case, or in any case
involving serious injury, a lawyer with specific experience in handling workers' compensation
claims on behalf of injured workers should be consulted. Laws in many states limit a
claimant's legal expenses to a certain fraction of an award; such "contingency fees"
are payable only if the recovery is successful. In some states this fee can be as high
as 40% or as little as 11% of the monetary award recovered, if any.
In most states, original jurisdiction over workers compensation disputes has been transferred by statute from the trial courts
to special administrative agencies or court appointed judges. The disputes are usually
handled informally by these administrative law judges. Appeals may be taken to an appeals
board, and from there into the state court system. However, such appeals are difficult
to win and are regarded skeptically by most state appellate courts. The entire premise
of workers' compensation was designed to reduce litigation. A few states still allow
employees to initiate a lawsuit in a trial court against the employer.
While some federal employees' coverage is under the jurisdiction of the federal government, workers compensation insurance
is generally governed under state law or the state act. Rules and regulations
for coverage can vary significantly by state.
If you have questions about your state's insurance rules or laws, contact one of our Workers' Compensation Specialist for
coverage questions and help regarding the specific rules in your state. We want
to help you better understand your coverage and find the best workers compensation
insurance options available.