Workers’ Comp Insurance Cost: What it Does and Doesn’t Cover

Did you know the average cost of medical expenses for workplace-related injuries is $44,000? The cost per death is even higher at over $1.3 million. Workers’ comp insurance can keep everyone safely covered.

What is workers’ compensation insurance? How much does workers’ comp insurance cost, and what does it cover? Find all the answers to your questions in this brief guide.

What is Workers’ Compensation Insurance?

Workers comp insurance is designed to protect employers and employees.

Each state has different laws regulating its respective programs. Texas and South Dakota are currently the only states where private employers aren’t required to purchase workers’ comp.

States like North Dakota require all employers to participate in their public programs. In states like New Jersey, employers are required to carry a policy but can choose their own workers compensation insurance provider.

Workers’ Comp Coverage

Workers’ compensation insurance only covers certain workplace-related costs. These can include:

• Emergency care
• Outgoing care
• Ongoing care
• Any other related medical bills
• Missed wages
• Rehabilitation
• Funeral expenses
• Family survivor benefits
• Lawsuits and legal expenses

These benefits can vary depending on coverage and/or the workers’ comp laws and programs in your state. An employer that doesn’t provide adequate coverage can be sued for civil damages in most states.

What Workers’ Comp Doesn’t Cover

You may have to look up what comprehensive coverage is provided by your policy or program.

• OSHA violations
• Deliberate self-injury
• Drug or alcohol intoxication
• Willful criminal acts
• Horseplay and fighting
• Off-duty activities
• Work-related commuting

Workers’ Comp Insurance Costs

Workers’ comp expenses can vary by policy and program. Factors affecting policy premiums include:

• Payroll totals
• Number of employees
• Experience modifiers
• Workplace safety
• State taxes and fees

The national yearly average is currently just over $900 per employee, according to AdvisorSmith.

Private insurance providers can offer flexible options to help small businesses manage costs.

Keeping You and Your Assets Covered with Comprehensive Workers’ Comp

Workers’ compensation insurance provides critical coverage for employers and employees. It helps pay costly medical and missed work-related expenses.

If you don’t have comprehensive workers’ comp coverage, you can face long and costly legal battles relating to workplace injuries and illnesses.

Learn other crucial business and finance tips by looking up additional articles on our blog!