Protecting employees from unexpected injuries or problems at work is essential for any company. Even a small business needs workmanâ€™s comp insurance once they start hiring employees, so it is essential for a company to recognize the reasons for purchasing coverage and the benefits associated with the protection.
Protecting Employees With Coverage
A key reason for workmanâ€™s compensation insurance is the coverage. Even in a low-risk position, individuals can face work-related injuries. Slip and fall accidents, physical health problems with respect to work environments, such as chemical exposure or accidents caused by professional equipment add up in high cost medical bills or other associated expenses. By purchasing insurance to help pay for the costs associated with workplace injuries, employees will have protection against financial challenges.
Workmanâ€™s comp insurance helps pay for the costs of injuries that occur on the job. As an employer, it is important to protect employees from potential injuries. When injuries occur, workmanâ€™s comp insurance helps pay for the cost of medical bills and lost work associated with the accident.
Since many states have legal standards associated with workerâ€™s compensation coverage, any small business must review the state standards and comply with any legal requirements. Generally, small businesses must purchase a policy if they hire an employee. Some exceptions may exist for specific types of positions and the number of employees, but most states require coverage if there is a single employee.
Partners are not usually considered an employee, so it is not always a legal requirement if the employee is also a partner; however, coverage is still appropriate if there are health risks associated with the work.
Limiting the Costs of Injuries
Although the state laws provide incentives to purchase workmans comp insurance for any small business, the primary benefit of coverage impacts the business or business owner. The cost of workplace injuries add up quickly, especially if an individual was injured while handling his or her normal activities and tasks.
When the coverage is not provided by an employer, an injury will add up in expenses that impact the companyâ€™s profitability. For example, a business owner will pay fines to the state government, the medical bills and any costs associated with lost wages. Additional fees can also add up if an individual takes the issue to a formal court proceeding and asks for compensation from a judge.
Workmans compensation coverage helps pay for any costs associated with an injury and prevents individuals from going to a court when injuries occur. Accidents happen unexpectedly and sometimes they result in high-cost injuries. The insurance coverage pays for the medical bills, death benefits or lost wages associated with the injury. It also prevents a lawsuit because an employee cannot ask for further compensation if the insurance company determines that additional compensation is not appropriate for the specific injuries.
Finding the Right Plan
The best insurance policy for any business depends on several factors, including the number of employees and the risks associated with the business. Generally, a high-risk business like construction will have a much higher cost for workmans comp insurance when compared to an office job. A high level of risk combined with a low number of employees only adds to the cost.
For small businesses, finding the right plan can seem daunting. Part of the problem is the rates that are offered based on the size of the company. Insurance providers do not always offer the best rates to smaller businesses. Fortunately, professional employer organizations help reduce the cost associated with insurance coverage by providing access to more comprehensive benefits programs and insurance plans. By working with a PEO, an employer is able to identify potential policies and ensure that the company is complying with any state and federal regulations.
Since PEOs assist with risk management and compliance, a small business is able to identify policies that are appropriate based on the risk level and the type of services that the business provides. Furthermore, PEOs help manage workmanâ€™s comp insurance concerns so that a business can focus on growth while still maintaining an appropriate level of coverage.
Workmans compensation insurance offers protection against high-cost bills and concerns associated with workplace injuries. Even if a small business has limited employees, purchasing a policy is essential for the maintenance and growth of the business. A PEO offers the assistance and tools that a company needs to find the right plan based on the goals and concerns associated with the specific company and services.