As a business owner, you do what you can to protect your company. Workers' compensation is an insurance program set up to provide injured workers on-the-job benefits to compensate for lost wages while taking care of their injuries. In many cases, workers' compensation is a state-mandated insurance that is required even if a business has only one employee. Workers' compensation insurance is designed to cover incidents such as the following:
There are some restrictions, however. An employee cannot receive benefits if the illness or injury is purposefully self-inflicted, not job-related, or received while committing a crime. Workers' compensation fraud is rare, but it can be a very real issue for businesses, so be sure to look out for suspicious signs that employees are taking advantage of the system. Investing in workers' compensation can put your business on more secure financial grounds. This means that your business does not need to worry about making costly injury settlements out-of-pocket. Employees who accept workers' compensation coverage surrender their ability to sue the business for their injuries. Therefore, the business doesn't have to cover unexpected employee lawsuits.