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Workers Compensation
Controlling Your Premium
BY : JEFF CRENSHAW , CRIS , CLCS , DIRECTOR OF SPECIAL PROJECTS AND CLIENT ADVOCATE , AT BOWEN , MICLETTE & BRITT
Workers compensation is a fact of doing business . The purpose of workers compensation is , of course , to provide a basic type of insurance for workers who are injured during their scope of employment . This is meant to cover lost wages and medical costs . From the business side of things , it is important to understand how your workers compensation policy works , what it covers , and how the premium is affected . Another aspect of this is how workers compensation claims could affect your actual day to day business operations moving forward . This is too much information for one article to handle so I will be putting this in a series of articles handling each of these topics in separate articles .
How Worker ’ s Compensation Insurance works :
“ Worker ’ s Comp is meant to be the sole , exclusive remedy for work related injuries .” This was taught to me when I attended Hartford ’ s School of
Insurance . It means exactly what it says . When one of your worker ’ s is injured , Worker ’ s Comp is the insurance that will cover your employees . Each state has separate rules that govern how much money their Worker ’ s Comp benefits will pay so it is important to remember that if you do business in other states , and your employees travel to these states , your employee has the option to choose either the benefits of the state where they are injured or the benefits of the state where you are insured from . Again , different states pay different amounts ( generally speaking ) so if you do work in other states , make sure you Worker ’ s Comp policy provides coverage in those states .
Monopolistic States should also be contemplated . Ohio , North Dakota , Washington and Wyoming are the only remaining monopolistic states . This means that the rates in those state ’ s coverage is provided by a “ monopolistic state ” fund . In other words , the state itself has a fund that you would
need to participate in for Worker ’ s Compensation benefits . It is NOT optional whether or not to participate in this fund if you are doing business in that state .
Worker ’ s Compensation Insurance as described above is not truly that difficult to understand and this was a “ 50,000 foot view ” of Worker ’ s Comp . Again , if your employee is injured , Worker ’ s Comp responds to the injury . If you don ’ t have Worker ’ s Comp insurance in some form ( including Occupational / Accidental which we won ’ t be discussing for the purpose of these articles ) then you are probably in trouble as you are “ on the hook ” for the injury as well as ( depending on the state ) hefty fines that can date back to the first day you opened your doors .
Jeff Crenshaw , CLCS , CRIS is Director of Special Projects and Client Advocacy , and has over 15 years experience in Insurance and Risk Management .
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