How Does Workers’ Compensation Insurance Work?
Paid sick days and personal time off (PTO) are popular perks a company can offer its employees. These are not mandated by the federal government, but several states do have regulations that require employers to offer paid leave for sickness or personal leave. When those are offered, there are limits that are directly related to how long the employee has worked for the company.
A sick day typically takes just one or two days as you recover from a cold or some other minor ailment. What happens if you’re injured on the job? You probably wouldn’t take a sick day. Instead, you would file a workers’ compensation claim.
This is an insurance program in every state (except Texas) that offers support and reimbursement for any worker injured during their job.
According to data collected by the Insurance Information Institute, 2,246,000 employees across the country filed workers’ compensation claims totaling $103 billion in benefits, coverage, and costs in 2022. Every worker needs to understand how workers’ compensation works.
The following guide will provide you with an overview of the program.
Understanding Workers’ Compensation
Workers’ compensation or workers’ comp is a type of insurance similar to private health insurance. The difference is that workers’ compensation only pays benefits related to employees who were injured while at work.
Each state has its own version of a commission. For instance, Ohio has the Bureau of Workers’ Compensation, and there is an Illinois Workers’ Compensation Commission. These commissions oversee the program and manage any disputes.
Workers’ Compensation Benefits
For most workers’ compensation claims, private insurance companies pay the actual benefits, which premiums paid by individual employers support. It is important to remember that employers cannot require their workers to pay for any part of the workers’ compensation program.
If you are eligible, you are entitled to seek the following benefits from a workers’ compensation claim:
Healthcare Cost Reimbursement
A worker injured on the job can have their medical expenses paid through an approved medical workers’ compensation claim. Those expenses include initial treatment, surgery, hospitalization, prescriptions, and medical supplies.
Occupational and Physical Therapy
Workers’ compensation insurance aims to provide you with financial support while you recover from your injuries in the hope that you’ll be able to return to work. To facilitate that return, you could be prescribed occupational and physical therapy. These sessions will be designed to support your specific needs to regain strength and mobility and help prepare you for returning to work. That might mean returning to a different job, but you’ll also be supported for that transition.
Survivor Benefits
If an employee dies due to a work-related incident, the worker’s surviving family is entitled to seek death benefits.
You can find out more about how these survivor benefits are paid out here.
Lost Wages and Disability
Unlike your company’s paid sick days, workers’ compensation only pays for partial lost wages. Typically, these amounts equal up to two-thirds of a worker’s gross pay. If the extent of your injury prevents you from returning to work, you could be compensated for a permanent disability. These are the kinds of distinctions where you might need an experienced workers’ compensation attorney as your advocate.
Types of Injuries Workers’ Compensation Insurance Covers
While many jobs come with inherent risks, you can get injured in any type of work environment, including an office job. Here are a few of the typical injuries that the workers’ compensation insurance covers:
- Carpal tunnel
- Back injuries
- Injury to the lungs from toxic substance exposure
- Slips and falls
Driving your car for business purposes and getting into an accident could be considered a workplace injury. However, driving to work as part of your daily commute would not be covered. That would be a separate personal injury lawsuit.
There are also some instances where an injury occurs on the job, and you won’t be eligible for workers’ compensation benefits. Consider the following circumstances:
- If blood tests reveal the employee was under the influence of drugs or alcohol at the time of the injury
- Self-inflicted injuries
- The employee was violating a law or company policy
- The employee was not on the job at the time of the injury
Waiving Your Right to Sue
One important thing to remember about receiving workers’ compensation benefits is that you are giving up your right to sue your employer.
Accepting any type of workers’ compensation settlement, you agree with those numbers and consider the matter resolved. Suppose there is a situation where your workplace injury was caused by negligence on the part of your employer.
In that case, you should speak with an experienced attorney before filing a workers’ compensation claim.
Work Injury Advisor has many helpful resources that provide additional information about how workers’ compensation insurance works and your options.
