Workman’s compensation is a well-known type of insurance wherein employees can file a claim to pay for damages, medical bills, and more. However, one common point of confusion is who’s required to pay it, which especially concerns business owners. In this article, we provide an in-depth explanation of whether employers are required to pay for workman’s compensation. Read on below to find out more about workman’s comp insurance in Minneapolis.
What Is Workers Compensation?
Workers’ compensation is a state-regulated form of insurance that pays monetary benefits for workers who become ill, injured, or disabled during their time of employment.
Through workers’ compensation, the employees receive benefits whether the incident is their fault or not. Unlike civil cases, a workman’s comp claim does not require proving who is liable. Meanwhile, employers are protected from possible lawsuits, allowing them to preserve their reputation and protect themselves from time and money loss.
How Workers’ Compensation Works
Worker’s compensation is designed to prevent both parties from having to spend money on any legal fees a civil case would require. Most compensation plans cover all medical fees related to injuries sustained as a direct result of their employment. For instance, someone who works in construction can ask for compensation if they were injured as a result of scaffolding that collapsed. However, they can’t ask for compensation if their car was hit by another on their way to work.
In some situations, a worker may be eligible to receive an equivalent of their sick pay if they need to take a medical leave. Furthermore, the family or dependents of a worker who dies due to employment can also receive workers’ compensation.
A Caveat to Employer Immunity
As mentioned, an employee who agrees to be awarded workers’ compensation also agrees to give up the right to sue an employer. There are only a few rare cases where someone receiving compensation could also file a civil case. Due to the uncommonality of these cases, however, this is something employers need not concern themselves with, although you can contact a legal professional at Osterbauer Law Firm to find out more.
The Kinds of Workers’ Compensation
Generally, individual states in the U.S. handle workers’ compensation, and as such, they will vary from one state to another. While the Office of Worker’s Compensation Programs is offered by the U.S. Department of Labor, its compensation policies are only applicable to coal miners, longshoremen, and federal employees. Due to a lack of federal standards when it comes to workers’ compensation, various kinds of policies are present for the same types of injuries across the country.
As a result, it’s vital for a worker who wishes to prepare and acknowledge the possibility of suffering from a work-related injury to do the following:
- Carefully evaluate the literature behind state compensation
- Thoroughly assess the literature regarding company compensation
Depending on where a worker lives, similar injuries can be rewarded with different levels of compensation. This is why it’s important to review both company and local compensation statutes.
An Employer’s Responsibilities
While workmans’ compensation is regulated by the government, in a way, the employer still pays for it. Because it is a type of insurance, covers both the employer and the employees. Moreover, it isn’t taken from payroll taxes and the employer is completely responsible for the premiums to be paid to the insurance company. Ultimately, it is up to the insurance company to pay for medical expenses, lost wages, settlements, and retaining costs.
As mentioned, nearly all employers from most states will be required to provide workers’ compensation insurance. There are, however, exceptions to this rule. For instance, a company doesn’t need to offer workers’ comp insurance in Minneapolis if they work with independent contractors. In addition, there are also separate rules for sole proprietor businesses as well, so your best option is to review your state’s regulations.
An employer may choose from private insurance or state-sponsored insurance for most cases. While a bigger business can choose to provide self-insurance, this will make them responsible for each of their workers’ compensation claims. Here is a more thorough breakdown of available insurance companies:
Insurance Companies: Private
The most popular option for many employers throughout the country is private insurance companies. However, an exception to this can be found in Washington state, where there aren’t private insurers available for workers’ compensation.
Apart from being classified as a private insurance provider, it works much like any other kind of insurance. Just like with state-run institutions, an employer will pay a premium to their insurance company. Should an employee get injured during work, the private insurance company will provide the benefits that could be awarded to the injured party as part of their claim for workers’ comp.
Insurance Companies: State
There are insurance programs and funds regulated through the state — this could be the Department of Labor or a different organization, and can be industry or commerce-driven. When an employer is able to keep up with their premiums, they will be able to pay for every employee’s workers’ compensation without any issues.
Insurance Companies: Self-Insured
There are some employers that are large enough to opt for self-insurance, which means that they have the necessary assets to cover for workers’ compensation or any liabilities on their own. Although, in some cases, an employer can become a third-party administrator who can handle such claims.
In this way, the employer is responsible for paying an employee’s workers’ compensation. Most of the time, however, an employer won’t have anything to do with the actual payout of the benefits or other payments associated with the claim.
Contact Us at Osterbauer Law Firm Today
If you have any questions on workman’s comp insurance in Minneapolis, call us at +1 612-334-3434 or visit our website today. With a combined experience of 76 years under our staff, you can trust that we’ll get the results you need. No matter where you live, we’ll be here to support you with any questions or concerns on this sometimes-complicated topic.
We’ve been providing our services since 1992, and over the years, we’ve worked on more than 15,000 cases. Get the help you deserve for your workers’ compensation case with Osterbauer Law Firm.