What is workers’ compensation insurance?

Workers’ compensation insurance, sometimes shortened as workers’comp insurance, falls into the category of the very few business insurance policies which any business just has to subscribe because they are legally bound to do so.

Workers’ compensation insurance typically covers medical costs and a fraction of wages lost during the time when an employee failed to report to work because he or she got injured or ill while doing the job. Coverage also includes protection when businesses are sued by their employees when their professional duties may cause them to suffer injuries or sickness.

 Examples of injuries falling into the typical coverage of a workers’ compensation insurance policy include injuries caused by common accidents such as tripping in the office, slipping on a wet surface, getting burnt or injured by fire or explosions, or injuries sustained while lifting heavy equipment. What happens in connection with the professional environment may or may not be covered by workers’ compensation injuries.

The difference between workers’ compensation insurance and employers’ liability is rather simple: workers’ compensation insurance exists in the United States of America, and employers’ liability insurance is the nearest equivalent in the United Kingdom. Also, coverage is relatively different.

Employers’ liability insurance pays for expenses related to compensation, hospitalisation, medication and legal costs in case an injured employee sues the company. Workers’ compensation insurance will rather ensure that the employee does not bring the issue before a court of Law.