As a business owner in the state of Minnesota, you need to know the ins and outs of workers’ compensation. Workers’ compensation is essentially a way for your injured employee to receive coverage for several expenses. These expenses are incurred during the course of an injury. The benefits can encompass:
- Medical coverage
- Medical assessment
- Vocational or rehabilitative training
- A percentage of your employee’s wages while on work restrictions
All of the above does not need to be a burden of yours as a business owner in the state. Instead, it is your worker’s compensation insurance provider that bears the brunt of the expenses.
However, as we all know, workers comp coverage is ultimately money out of your insurance provider’s pocket. At some point, the insurance provider may want all or part of the money back.
While workers’ compensation is a must in Minnesota, the law does not prevent insurance providers from reclaiming part of the money used.
Knowing this can save you a lot of trouble. It can even allow you to save money. So, to learn more about when workers’ compensation needs to be paid back, continue reading.
Subrogation in Minnesota
Subrogation is defined as the procedure where an insurance provider can claim some of the money from a work injury settlement. During subrogation, a party that paid monetary benefits to an injured employee can recoup some of the money or all of it. This is especially the case in situations where a third party was held liable for the work-related injury.
Minnesota statutes on workman’s comp do not bar insurance providers from reclaiming part of the workman’s comp paid. When third parties are involved, the Minnesota statutes allow insurers or any paying party to make a subrogation claim.
A successful subrogation claim results in the reclamation of the insurance provider’s coverage — be it the partial or full amount.
What Is the Rationale Behind Subrogation in Minnesota?
In the eyes of many employees, an insurer’s rights to subrogation seem unfair. However, there is a reason the state allows insurance providers to reclaim the money. And, it is based on the principles of the avoidance of double claims and who insurers are supposed to cover.
In Minnesota, double claims occur when an injured employee receives benefits from workers’ compensation and an added monetary benefit. This added monetary benefit can be from the settlement of a personal injury claim filed against a third party. Effectively, the injured worker receives two benefits while the insurance provider does not get reimbursed.
This may not seem like a big deal. However, this takes us to the concept of who an insurance provider is supposed to cover. During work-related incidents in Minnesota, workers’ compensation insurance covers you, the employer. It should not cover the injuries caused by a party that is not you.
Hence, workers’ compensation lawyers in Minnesota recognize an insurer’s right to a subrogation claim.
What are Third-Party Situations?
Third-party situations may be understood as scenarios where fault can be traced to a party not related to the job. These are situations that do occur on the job but remove the employer from direct liability. In such situations, an injuring party is considered the third party.
Third-party situations in Minnesota are the most common reasons for insurance providers to file subrogation claims. The reason insurance providers reserve the right to a claim is that insurance providers have a responsibility only to pay compensation where the employer may be accountable.
In a third-party situation, the insurance provider, effectively speaking, pays on behalf of a party that is not the employer. This gives an insurance provider the right to subrogation, especially if an injured worker filed a personal injury claim against a third party.
What Are the Most Common Third-Party Situations in Minnesota?
Third-party situations come in many forms. In Minnesota, some are more common than others. Here are some of the most common scenarios where your insurance provider can make a subrogation claim:
When Your Employee Is in a Motor Vehicle Accident Because of Another Person
In Minnesota, a driver can claim workman’s compensation in the event of a motor vehicular accident. Of course, the injury should occur within a driver’s regular working hours. And, the vehicle being operated must be yours or your business vehicle.
An injury arising out of an accident under normal circumstances is a work injury case. On the other hand, if another person is to blame for the motor vehicular accident, then this person would be the third party.
If your employee files a personal injury claim against this person, your insurance provider can ask for the money as reimbursement for coverage.
When a Faulty Product Used at Work Led to the Work-Related Injury
Here is an example.
Imagine that your employee was working with paint. The paint of your supplier contained toxic chemicals not disclosed to you. As a result, your employee after months of using the paint became sick.
In this scenario, the supplier can be liable because of not disclosing the contents of the paint. In this case, a personal injury claim can be filed by the employee. Of course, part of the personal injury settlement money or all of it can be reclaimed by your workman’s comp insurance provider as reimbursement.
In Situations Where the Premises or Environment Off-Site Led to the Injury
Sometimes, you may require your employee to make deliveries or visit a place in line with worker obligations. If an injury occurs, the third party would be the owners of the property in which the employee sustained the injury.
To illustrate, imagine that your employee was making a delivery. Upon reaching the destination, your employee slips and falls on one of the property’s steps. This can shift liability to the owner of the home. In such a situation, your employee can file a personal injury claim.
The Injury Occurred at the Hands of a Professional Practitioner
This is usually the case for work-related injuries that occur in a health care setting. Hospitals have many medical professionals that render several types of services. In some cases, they can even treat other employees. And, this is where professional liability can occur.
Professional liability occurs when an injury occurs after a professional practitioner renders care. For example, if your employee is injured further because the nurse incorrectly inserted an IV line, the nurse would be liable. Your hospital will not be liable.
Consult a Workers Compensation Lawyer in Minnesota
Workers compensation lawyers in Minnesota can provide you with all the necessary information and guidance when it comes to workman’s compensation and subrogation.
If you own a business in Minnesota and have any questions about when insurers can file a subrogation claim, reach out to us at Osterbauer Law.