Workers Compensation Insurance

Workers compensation insurance, or “Work Comp” coverage, offers benefits to employees of companies and must be purchased by employers.

Most states require some form of workers compensation insurance, but have different laws regarding benefits.

Unlike car insurance liability, workers compensation is based on the principle of liability with no-fault. This means employees do not have to prove negligence on behalf of their employer to collect benefits.

The employer has absolute liability for any injury that takes place in the course of employment.


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A workers compensation policy is made up of three parts; state benefits, referred to simply as work comp, employer’s liability, and “other states” benefits.

In order to qualify for the state workers compensation benefits, two requirements must be satisfied.

First, you must work in an occupation that is covered by work comp laws. No need to worry, as most jobs are covered here. There are few instances where you would have no benefits, or limited benefits.

Examples may include household employees or employees who work for companies with less than a specified number of workers.

However, having at least one employee typically means workers compensation insurance must be purchased.

Next, in order to qualify for benefits, you must suffer bodily injury or disease as a direct result of your employment. For example, if you have cancer unrelated to exposure at your job, you will have no rights for damages.

The benefits available vary by state, but include four basic types, including medical services, weekly disability, rehabilitation, and death & dismemberment benefits.

As discussed, each state has different laws, so be sure to contact your employer or state department of insurance to determine what benefits you may be eligible for as a result of a work-related accident.

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