Workman's Compensation - The Necessity Of Carrying Workman's Comp Insurance

By their very nature, construction sites are particularly dangerous places to work for employees. Heavy machinery, bulky materials, steel girders and potentially hazardous power tools and earth moving equipment are used, often leading to severe and sometimes even fatal accidents. That is why it is absolutely crucial for construction companies to carry not only workman's comp insurance but also general liability insurance to protect them from potential claims resulting from injured employees as well as the possibility of injured clients or even casual bystanders.In most states, all employers are required to provide workers comp insurance for employees by law. Failure to do so will not only result in serious penalties but also possible imprisonment for breaking the law. The company will also be left in the unenviable position of having to settle injury and disability claims themselves - no matter whether the employee was negligent or at fault. These damages may very likely run into several hundred thousand and even millions, of dollars depending on the severity of the accident sustained and may end up financially crippling or bankrupting the company. That is a good reason why, even if workers compensation insurance is not mandatory, it is still a vital precaution for any responsible company with employees to carry this insurance.How does workers comp insurance work?Workers comp insurance policies covers the company against all liability and damages resulting from injuries, illness or death suffered by employees as the result of occupational accidents, hazards or negligence. In the event of an accident, illness or fatality at the place of work, employees or their beneficiaries (in the case of the death of the employee) are fully compensated, no matter who was at fault - the company, or the employee. The amount of insurance paid out is in proportion to medical bills, lost wages, or permanent disability. This also means that employers receive immunity against further civil lawsuits by injured employees.How does a company obtain workers comp insurance?Employers purchase workman's compensation insurance from private insurers. Insurance premiums vary depending on the number of employees.What benefits do workers receive from a workers' comp policy?All medical bills are taken care of and employees may also be compensated for temporary or total disability. Additional payments will be made if the worker has suffered a permanent disability such as the loss of limbs, damaged eyesight etc, or is unable to return to work due to the severity of the injuries. If the employee is killed while on duty, the insurance is paid out to their dependents.Maintaining coverageThe onus is on the employer to maintain workers comp insurance at all times. Failure to do so will result in penalties or imprisonment, as well as being liable for the cost of injuries sustained by workers. For minor accidents under $1000, the company may elect to pay the bills themselves.InjuriesIn the case of injuries and accidents, the employee is obliged to provide immediate medical treatment for workers and must also notify the insurance company.