Businesses Without Workers' Comp Insurance Take Serious Risks
Posted by Nancy Mullin on Fri, Feb 17, 2012
The risks of not having workers? comp insurance can be immense.? Whether an employer runs a small office or has a medium sized business, hires one employee or oversees many, they should be aware of the fact that if any employee is injured during work, they can face huge liabilities.? A small firm can even go out of business.
Laws on workers? comp vary from state to state.? In some states a company may not have to carry workers? comp insurance if there are less than three employees, while some states may require the insurance even if there is only one employee.? In some states, having workers? comp insurance is mandatory and the employer or company can face legal action or severe penalties for not carrying workers? comp insurance.
What Does Workers? Compensation Insurance Cover?
If any employee suffers from any injury during work, the insurance will cover his or her medical treatment, hospitalization, rehabilitation and also lost wages.? If the worker suffers from temporary or permanent disability or fatal injury, the workers? compensation insurance should be sufficient to take care of all the expenses.? This is a safety net for the employer and the worker? as the insurance company will have to pay for any problems arising out of the injury, even if they do not come up for several years.
Under the Occupational Safety and Health Act of 1970, the employer is responsible for the safety and welfare of the workers.? Both physical and mental injuries come under OSHA.
An employer should ideally get worker?s comp insurance even if he or she is a sole proprietor and does all the work themselves.? This way?they will not incur out of pocket expenses if?they get injured on the job.
The kinds of injuries covered by workers? comp insurance include:
- Repetitive stress injuries like carpal tunnel syndrome or exposure to any chemical and/or dangerous substances
- Injuries which may be caused by operating any kind of machinery
- Any object falling on and injuring a worker
- Slips or falls
- Physical or mental stress due to work
What About Other Types of Accident Insurance?
While a business may ?get by? with other insurance products like accident and limited benefit health policies, non-subscription agreements, employer indemnification products and the like, these simply do not offer the same benefits as a full-fledged workers? comp insurance policy.?? Many of these products have limited liability and a ceiling to the compensation covered.? If a compensation case goes to court, most likely these products will not cover the legal fees.
And courts can even award punitive damages running into millions of dollars.? Can a company really afford to take the chance of having to file for bankruptcy or sell off the business because a worker got injured?
What?s the Cost of NOT Having Workers? Comp Insurance?
Just think about these recently awarded claims:
- An Illinois man received $3.6 million as punitive damages when the jury found that he suffered back injuries at work as a result of which he was eventually fired.
- In Virginia a temporary worker, hauling trash, went into a coma after working for hours on an extremely hot day.? After a long legal battle the man was awarded $3 million compensation with more to follow.
- When an under-construction floor fell on a worker and broke his leg, he received $350,000 as compensation.
If a company does not have workers? comp insurance, they will have to pay the compensation, even if it means selling off the business.?
Are you willing to take the chance and risk everything?? Protecting your business is the affordable choice.?