Workers’ Comp Insurance – What does it cover?
Workers’ comp insurance – what does it cover? in this brief video and post I’ll go over that, coming right up.
Okay, Workers comp insurance – what does it cover?
This form of insurance is mandatory in most states when you have employees, and it pays for the following when an employee is injured or becomes ill on the job:
- medical bills
- rehab expenses
- Surgical costs
- ongoing care
- and, mileage reimbursement for getting to and from doctor appointments
all set by statute – meaning the reimbursement rates are set by the state.
It also covers full or partial disabilities arising from those work-related injuries – also set by a state schedule.
Lastly, are wages.
Workers comp pays a portion of lost wages during the period of time the injured worker is unable to work.
That wage is the average of the last 52 weeks of wages times two-thirds – so say an injured worker had an annual salary of $50,000 that’s an average weekly wage of $961 – that gets multiplied by 66.67 or two-thirds to arrive at a weekly reimbursement of $641.
You may be asking why don’t I get my full wages and the answer is that replacement wages under workers comp are not taxable, so this two-thirds equation sort of evens that out.
Also, there are some caps and maximums which differ with every state.
What happens if an employer doesn’t carry workers comp and a worker is injured?
The employer will pay the costs of remediating the claim out of pocket and probably be fined by the workers’ comp authority in their state for failure to carry coverage.
So, everything I’ve mentioned talks about protecting employees for on the job injuries, but what about the employer?
Glad you asked.
There actually is something in the workers’ comp policy called employers liability insurance, or part 2 of the policy, and that protects the employer from lawsuits that may arise from employees or their spouses for work-related injuries or illnesses.
So there you have it in a nutshell. Have other specific questions about workers comp that I didn’t cover here?
I have a ton of videos on this coverage so you can search on my youtube playlist or you can contact me directly.