Difference between Employers Liability Insurance and Workers’ Compensation

The former employee can also sue to claim compensation amount for the work-related illness or injury. Upon death which is consequently caused by the cause of their work to accident or negligence, the employer liability insurance should be able to compensate the family. Short term employers, contractors or casual workers also need employers’ liability insurance.

Employers’ liability insurance is a legal requirement in any business firm with at least one employee. When the employee does not take the policy, there is a fine. Some organizations are exempt from the legislation. For example, those organizations with close family members as employees This cover is only available when purchased with the insurance companies to be able to cover all the employees within the company.

Claim risk reduction

The employer should ensure that the working environment is safe for the employees to work in. Promoting good health and practicing safety within the organization reduces accidents and illness, hence reducing the claim risks.

Workers ‘Compensation

Workers compensation is an insurance which is able to protect an employee under the state of laws. It provides replacement of wage and a medical bill to all employees who are injured on the job, in place of a compulsory relinquishing of the workers right to sue his employer for negligence. Example of such claims is; medical care, disability, death and rehabilitation for employees who are either killed or injured while on the job. These premiums are based on the payroll of the employer and the type of duties the employees are entitled to perform.

Workers compensation is the employers ‘expense and it is legally mandated in all organizations. The payment varies depending on a number of previous claims by the company or the employees’ occupation that may be considered dangerous. It is awarded on a no-fault basis. This is when the employee is under no influence of drugs or alcohol. Therefore, employees submit to drug test results.

Laws of the state

Also known as workmans comp, different states have different laws, therefore, it is important to understand what the laws say in your state concerning the worker’s compensation. There is no policy limit on workers compensation. The insurer tends to pay all benefits that are required by the law of the state, nonetheless, the employer may be held responsible for payments exceeding regular workers compensation benefits. In such cases, the employer will be charged by a misconduct of violating employees rights. the employer will, therefore, reimburse the insurer for all the payments above the regular benefits of worker compensation.

When are these claims paid?

When either the employer or the insurance carrier agrees that the illness or injury is related to work. In case there is a conflict, the worker’s compensation law judge will have to decide who is on the right. If the insurance and the employer are still on conflict, the employee is eligible to a disability program which will be deducted from future workers compensation benefit. However, your injury can also hinder you from getting the exact amount you used to earn before your accident. In this case, you may get two-thirds of the difference and your employer may also reduce the weight of your job.

What workers’ comp covers

This insurance covers compensation of accidents that occurred strictly in the workplace. The policy may cover the period of lost income while the employee was not able to work.

Most of workers comp insurance policies cover costs incurred on rehabilitation during the accident. This makes it simple for an employee to resume work after recovery. But in case an employee loses his life in the line of duty, there is payment of death benefit under the same law. To reduce the financial risk of the business, workers comp insurance can cover the death benefits.

Benefits

• If you employ people in your business, ensure you cover all the employees to protect them against costs and income losses due to on job injuries.
• It is legally required to purchase the policy to cover the costs of workers compensation.
• It is important to protect your employees to reduce unnecessary claims which may be significant financially to your business.

For more information about workers compensation insurance California, contact us now.