Epiphany Community Services

Workers compensation policy is important for both the employee and the owner which means it covers the employee’s medical expenses and lost wages when they face work related illness or injury. Also, Death benefits are available in this insurance for the people who are killed on the job. The best thing about workers compensation insurance is it provides disability benefits as well. It really does not matter if you have a well-established business or just a start up, you should know when and how to buy worker compensation insurance. 

In most countries, people need to buy a worker compensation issuance when they hire their first employee. Even if you are not working with any partner in business, you need to get the license for worker’s compensation insurance according to the rules of the state. Without it, you will have to pay from your pocket for the fine. Workers can also take advantage of investment property loans in time of need.

In workers comp insurance there are several types of injuries that are covered like, violance, terrorism, natural disasters. This law doesn’t only include workplace injuries also it covers employee illness. For example, if any employee gets sick from any chemicals at work. 

This insurance is purchased by the businesses and is underwritten by insurance companies/organizations.Every state has a different kind of worker’s compensation law. For example, if the company headquarter is in one state and all the employees are working in another state then you will have to buy the worker compensation insurance where the employees are working. The basic purpose of this insurance is to run your business as safely as possible. 

Moreover, the state has the authority to divide who sells and handles worker’s comp policies. This can be:

  • Private insurance company
  • state -run agency
  • The state itself 

Anyhow, it depends upon the number of employees in the company. If anyone starts a business with any employee, they need to carry workers compensation insurance. Even if you hire somebody from your family or friends, still you need to cover them under the light of workers comp. 

Workers comp law is also good for small business owners because in the case where the owner’s family sues his business, this law will help the owner to cover his legal cost.  Another good point of this insurance is “helping in internal shifting” if the employee of any company is not satisfied by his designation, this law will help him to shift his designation by giving him free training sessions of the new designation.

However, If you are self-employed or self proprietor and you don’t have any employees for the work, you don’t need to buy any worker’s compensation insurance. So, how is the worker’s comp calculated? There are a few factors of insurance such as:

  • Payroll
  • Claim history 
  • Number of employees

The basic calculator for worker comp insurance is work by noticing the worker’s class code rate to claim experience modifier. Lastly the payroll/$100 (according to the state’s policy). This is how the insurance companies calculated the workers comp insurance. Every state has its own classification code depending upon the nature of work.