When you’re ready to start a business, you’re probably thinking about the product or service you’re going to sell, your sales strategy, your marketing plan, the team you need, and even the documents you have to fill out to become an established company. But what’s something that might not cross your mind as quickly? Workers’ comp, and specifically, how to get workers’ comp.
Getting workers’ comp insurance is not difficult or the most time-consuming task you’ll have to complete when you start your business. In fact, if you want to get workers’ comp coverage, you only need to find an experienced insurance company to help you.
With workers’ compensation laws varying across state lines, you’ll want to seek an insurance provider that understands your business’s unique needs. Let’s be honest. The last thing you want is for a workplace injury or illness to occur, and your insurance provider fails to help you.
A great provider is going to set you up for success in case one of your employees falls victim to an injury or illness while on the job. However, a great provider will also know if your business needs workers’ comp insurance in the first place.
Does your business need workers’ compensation insurance?
Workers’ comp insurance allows your business to pay for an employee’s medical costs and rehabilitation expenses. It can also provide partial lost wages if an employee has to miss work because of an injury or illness. Some workers’ comp policies even offer death benefits if one of your employees dies while performing a work-related task.
The versatility of this coverage makes it an attractive option for many businesses, and most companies have to purchase workers’ comp insurance if they have employees. But the determining factor regarding whether you need workers’ comp insurance will rest on where your business and employees are located.
You’ll have to check your state’s requirements to discern if your corporation or small business needs workers’ comp. State laws will differ around this coverage. In Texas, for example, workers’ comp insurance is optional for employers to get. But in other states, this law is totally non-existent.
Most states typically look at the number of employees that your business has to determine if you need workers’ comp insurance. And many states will require you to get the coverage as soon as you hire your first employee, or you’ll face the consequences.
The penalties of not having workers’ compensation insurance
The consequences of not having workers’ comp insurance will vary state by state. But no matter where you live, the penalty can be brutal, sometimes even resulting in jail time, a hefty fine, or both.
There are a few states, in particular, that enact severe consequences.
1. New York: If your business doesn’t have workers’ comp in the city that never sleeps, you might face a misdemeanor or felony. Your fine will be anywhere between $1,000 – $50,000. And you’ll have to pay $2,000 for every ten days that you go without coverage.
2. Illinois: Without workers’ comp insurance in Illinois, you’re looking at a $500 payment for each day of non-compliance. Your minimum fine will be $10,000, which might sound small if you own a major corporation. But if you run a big company, who wants to spend $10,000 on a fine if that money could go towards a nation-wide marketing campaign?
3. Pennsylvania: If you’re an employer who is intentionally choosing not to get workers’ comp insurance, you’ll face a felony of the third degree. Your non-compliance might also lead to a $15,000 fine and up to seven years in jail, making you spend much needed time away from your business.
4. California: In this state, it’s a criminal offense not to offer workers’ comp insurance. You could go to jail for up to one year, receive a maximum fine of $10,000, or experience both. And if you own an illegally uninsured business, you could face up to $100,000 in penalties.
While some states offer harsh punishments for non-compliant businesses, it’s all for a good reason: state officials want to see your business succeed and your employees stay safe. Workers’ compensation coverage is a crucial part of your business’s success, and it provides many benefits for your brand.
Workers’ compensation benefits
While it’s easy to think that nothing will physically harm your employees, no workplace is without risk or entirely safe. Even if your company has thorough safety policies, one of your employees could still fall ill or get injured on the job.
In fact, the U.S. Bureau of Labor Statistics found that private industry employees in 2018 experienced 2.8 million nonfatal workplace illnesses and injuries. This research mirrors the data from 2017, which suggests that workplace injuries and illnesses aren’t declining or going anywhere.
Your business needs to be prepared for the worst-case scenario. And you can prepare your company by having workers’ comp insurance. This coverage will benefit you in the long run.
If an employee becomes injured or ill on the job, you won’t have to pay out of pocket for their medical treatment or suffer any fines or consequences. With workers’ comp insurance, the process of resolving the injury or illness is simple and painless.
How to tackle workers’ compensation claims
If one of your employees experience a work-related injury or illness, it can feel devastating as a business owner. Thankfully, the claims process can help you settle the injury or illness effectively. You just have to follow a handful of steps.
1. Go to an approved medical professional
When one of your employees is injured or ill, find and seek medical assistance. Don’t hesitate to take this step.
Immediate medical attention is necessary as any delays can put your employee’s health at risk. Once you get an approved healthcare professional involved, the physician will create a medical report to file along with your employee’s injury claim.
2. Jumpstart the claims process
As the business owner, you are responsible for starting the claims process. It is your job to offer the correct documents, contact information for your brand’s insurance company, and resources about the claims process. After you have all of this information, give it to your employee so he or she can take the next step.
3. Have the employee file a claim
Once you’ve compiled everything that your employee needs, have your employee file a claim with your insurance company. But please make sure your employee pays attention to the deadlines.
There’s a specified amount of time that employees have to file a claim, and it differs from state to state. If your employee takes too long to contact your insurance company, he or she might not receive benefits, causing frustration and disappointment on their end.
4. Experience the benefits of workers’ comp insurance
After your insurance company approves the claim, your employee can start getting workers’ comp payments. Your employee will likely receive money for their rehabilitation expenses, medical costs, and two-thirds of their wages while they stay home from work.
5. Create a smooth transition back to work
Depending on your employee’s illness or injury, you’ll need to determine the best time for them to return to work. It might make sense for your employee to come back full time or part-time until they can handle a full work week.
But the most important thing to consider in this decision is a doctor’s advice. You’ll want to check in with the physician to get the best recommendation on when and how your employee should return to work. And you’ll want to make sure you offer a smooth transition by having the right accommodations in place.
These steps in the claim process are not difficult to implement. And sometimes, you can work around them entirely if you and your employee reach a workers’ comp settlement. This type of agreement is voluntary and allows you to resolve the case by giving your employee a lump-sum payment that you both agree on. Once you finalize the settlement, you resolve the case permanently.
How to get workers’ comp through the best providers
Workers’ comp insurance is one of the most beneficial things that you can get for your company. It protects you, prevents out of pocket costs, and provides your employees with benefits in case they get injured or ill or the job.
Of course, you’ll still want to put policies in place to ensure you decrease the risk of workplace accidents. It’s important to conduct ongoing safety training, encourage employees to share concerns and questions about safety, and provide information about your insurance plan.
But none of those steps should replace your responsibility to get workers’ comp insurance. If you want to obtain this coverage, find a good insurance provider to help you. Then, contact a representative at the company.
Businesses like Barry Risk Management, Inc., for example, have plenty of representatives who can help you get workers’ comp insurance in your state. Barry Risk Management, Inc. make the process easy and straightforward, so it doesn’t take long for you to get this coverage. And their representatives have the proper knowledge to ensure your workers’ comp insurance is tailored to your business’s unique needs.
For more information, contact Barry Risk Management, Inc. to learn how to get workers’ comp in your city to protect you and your employees!