Expert answers to all your business insurance questions.
Why do I need workers’ comp insurance?
- Workers' Comp Basics
You need workers’ comp because it is required by law just about everywhere. Without it, your business could face fines, penalties, and a potential lawsuit. Depending on where you live, you might also be guilty of a criminal offense and could even face jail time. Workers’ comp also protects your team—it provides important medical and wage benefits to your employees if they ever get hurt at work.
Let’s look at all this in a little more detail.
Workers’ comp protects you from serious legal trouble.
If you choose to go without it, you’ll be guilty of a criminal misdemeanor or even a felony. That means that, if you’re caught, you could spend some time in jail. They’re not messing around. Your business will likely be fined, too.
And there’s more. Without workers’ comp to protect you, an employee is allowed to sue you directly for personal injury damages. That means you’ll need to get legal help and pay out for whatever financial settlement the court decides. The bill for these personal injury claims can be very, very expensive.
On the other hand, if you have workers’ comp, you’ll be on the right side of the law. Plus, when your employee receives benefits under a workers’ compensation claim, they give up their right to sue you directly (in most cases).
Workers’ comp protects your employees from financial hardship.
Workers’ comp is the right thing to do for your team.
If someone you hire is injured while working for you, it can have serious effects on their ability to earn a living and pay bills. Workers’ comp helps them out by paying for their medical expenses and replacing lost wages while they recover. If their injury forces them to change careers, workers’ comp can help pay for job training. And, in the event of a tragedy, workers’ comp even helps their family out with funeral expenses.
Basically, workers’ comp is important for both you and the people you hire. It’s also much cheaper than a lawsuit. There’s really no reason to go without it.