Introduction

Almost all businesses with employees are legally obligated to take reasonable care to assure that they provide safe workplaces to their employees. Nevertheless, mishaps happen. Handling the expense and effort of meeting statutory obligations to workers who are injured or ill due to workplace exposure is an ever-present challenge to all businesses. The workers’ compensation insurance policy is a primary method by which an employer shows its ability to meet the obligation imposed by workers’ compensation laws. This policy helps a business owner to provide legal liability coverage for reimbursement to employees for bodily injury or death caused due to accidents at workplaces. It also covers occupational diseases arising out of and in course of employment.

When a business owner purchases workers’ compensation policy, he/she is assured by the insurer to pay all benefits related to the insured employer’s state workers’ compensation laws without any regard to liability. The premiums to the policy are based on two factors: type of duties performed by the employees and the employer’s payroll. The number of benefits provided and the workers’ compensation laws may vary from state to state.

Workers Compensation Coverage

Workers’ compensation policy coverage provides compensation to employees who have been injured or died in the field of employment. This coverage is provided regardless of the fault of the employee or the employer. It means an injured employee can not sue a business owner for negligence to get benefits. Moreover, if the negligence of the injured worker has contributed to the injury, the worker is still eligible for benefits. For example, suppose a worker sustains a foot injury at a production site. The injury could probably be avoided had the employee wore safety shoes, as instructed.

Even so, the worker can file for workers’ compensation claims and still eligible for benefits of the policy.

The following are some primary coverages included by all states in the workers’ compensation insurance policy:

1. Medical Coverage: It covers all medical bills and also includes the expenses of doctor visits, hospital care, prescription medications, physical therapy, and other medical treatments.
2. Disability: Disability benefits provide a partial replacement of earnings lost when workers are unable to work due to a work-related injury. The disability may be classified into four categories: temporary total, temporary partial, permanent total, and permanent partial.
   • Temporary Total: The worker is totally disabled by the injury and is unable to work for a short period of time. For example, a worker breaks his arm and is unable to work for six weeks. He returns to full duties after a six-week disability.
   • Temporary Partial: The employee is only partially incapacitated by a short-term injury. For example, an employee injures his back on the field and consequently works part-time while his back heals.
   • Permanent Total: The worker got a permanent injury that cannot be cured. As a result, the future income can not be earned by performing the type of work the worker was doing at the time of the incident.
   • Permanent Partial: The employee has sustained a permanent injury, such as hearing loss, that prevents him from earning as much income as he earned before his injury.
3. Vocational Rehabilitation: To the workers who cannot return to their prior job due to an on-the-job injury, it enables them to learn a new skill based on their current capabilities.
4. Death Benefits: These benefits are provided to the spouse, minor children, and other dependents of a worker who dies on the job. Some states also cover the burial costs of the worker in the policy coverages.

Moreover, the workers’ compensation policy covers the medical expenses of occupational disease(a disease or disorder due to the work or working conditions). The state law for insurance determines which occupational diseases are covered in the policy. For a disease to be covered as an occupational disease, it must be caused or aggravated by the conditions of employment. We can take the example of asbestosis(it is a lung disease resulting from the inhalation of asbestos particles) as an occupational disease.