Workman’s comp insurance can turn out to be very important to the successful operation of any business. In many places, workman’s comp insurance is a legal obligation for a business to have. In the few places where businesses do not have to have workman’s comp insurance, they are still liable if an employee is injured on the job.
Any claims filed by an injured employee can quickly add up, sometimes into the hundreds and thousands of dollars. Here are the top five reasons employers should carry workman’s comp insurance.
One of the most important reasons for good workman’s comp insurance coverage is to keep employee’s financially protected if they are injured. Any work injury, but especially serious injuries, can put an employee out of work for months at a time. This harms their family financial situation and affects every aspect of their life. They can be suffering pain while healing from an injury, and sometimes damage can be permanent.
Protection Of The Company
The company is protected by good workman’s comp insurance. This is especially true when they have specific limits set up for financial liability in the case of injuries. Employers must make sure they have enough workman’s comp insurance to protect their company’s assets in cases of injury.
Insurance Helps In Third-Party Liability
Workman’s comp insurance becomes very important, especially in the case of a third-party injury. These claims happen when an injured employee sues the manufacturer of a machine that they were injured on. The manufacturer can then turn around and attempt to sue the company, especially if the machinery wasn’t used exactly to the manufacturers user specifications. Having proper workman’s comp insurance helps to protect the employer and to limit the amount they have to pay when employee’s are injured. Failing to have workman’s comp insurance can become a very risky proposition. In some places it can even be illegal.
The Law May Require Workman’s Comp Insurance
Another reason for a company to have workman’s comp insurance is because, in many places, it’s required by law. It is wise to check with the specific requirements for the state or country your company is operating in for their insurance requirements. In many places, if a company has more than three employees they must have insurance. Requirements can vary, however.
Having Insurance Helps A Company With Budgeting
Since an employee can be injured at any time, it’s helpful to the budget of a business to know exactly what their costs are for workman’s comp insurance premiums. If a company has the choice whether to carry insurance, it’s smart to have it so costs are known entities. If an employee is injured at an uninsured company, costs can be wildly unpredictable due to the lawsuits filed and damages awarded. Most companies do not want unforeseen expenses to be a part business costs.
Having workman’s comp insurance is an important protective measure not only for employee’s. It can be very helpful to employer’s as well. It can bring peace of mind that an employee will be compensated if they are injured while on the job, and that they will receive payment for lost wages due to having to miss work because of an injury. It can also help employers by giving them some protection against large lawsuits.