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What Is Workers’ Compensation Insurance?
Workers’ compensation insurance (also known as workmans’ comp insurance) provides benefits to employees for work-related injuries or illnesses including medical care, wages from lost work time, and more. Workers’ compensation insurance covers a deceased worker's family with a financial benefit as well. If a worker's family decides to sue the company, it can also help cover the related legal fees.
Workers’ compensation insurance can help protect your business and employees in events such as these:
- An employee slips on ice, injures himself while walking up the stairs to the office, and requires an emergency room visit and weeks of recovery time.
- An employee injures her back lifting a box of printer paper and requires a doctor’s attention, medication and physical therapy.
- An employee returning to the office from visiting a client is injured in a car accident and requires hospitalization.
With workers’ compensation insurance, The Hartford will help pay for the medical expenses needed to treat these job-related injuries and illnesses. Workers’ compensation will also help employees keep their income while they take time off to recover from an injury.
Find out how you help your business and your employees by getting an insurance quote today.
How Does Workers’ Comp Insurance Work?
When employees suffer a work-related injury or illness, The Hartford Workers' Compensation Insurance protection helps cover wages and medical benefits and gives them access to experienced, caring professionals at every step of their recovery.
We have programs designed to support companies, promote employee safety and well-being and help get personnel back to work as soon as reasonably possible; or if necessary, to other transitional work, and possibly training for new skills. If an employee can't return to work, the coverage can provide a long-term benefit.
The advantages of workman’s comp insurance from The Hartford include:
- Preferred Medical Provider Network: Employees can tap into our nationwide network of more than one million providers experienced in treating workplace injuries.
- Prescription Drug Features: More than 65,000 participating pharmacies throughout the US are available to fill prescriptions, usually with no out-of-pocket expense to the injured worker. The convenience of mail order service is just a phone call or click away.
- Nursed Back to Health: The Hartford provides highly experienced nurse case managers to help coordinate care and treatment along with physical, emotional and occupational therapies.
- Pay-as-You-Go Billing Solutions: Our pay-as-you-go workers’ compensation insurance billing solution bases premium payments on actual payroll, which can help you manage cash flow and reduce audit surprises.
How Much is Workmans’ Comp Insurance?
In most states, the cost of Workmans’ Comp insurance can vary between insurance companies as they compete for customers. Despite the variability, all insurance companies base Workers’ Compensation premiums on the amount of payroll an employer has as well as how dangerous the work is. Some larger employers will be impacted by their past claims experience with premium credits for low claim experience and increased premiums for those with more historical claims.
The cost of Workmans’ Comp insurance is calculated based on a rate charged per $100 of payroll. Rates vary by state as well as based on the type of work employees are engaged in and the businesses claims history. Though many business-specific elements are factored into an actual premium calculation, this simple formula is the basis for determining the cost workers’ compensation premiums.
Workers Class. Code Rate X Experience Mod.# X (Payroll/$100) = Premium*
The Workers Classification Code rate is determined by the type of work performed by its employees and different types of work are charged different rates. States provide the basis for rates by classification code.
The Experience Modification is determined by the business’s insurance claims history and is calculated by the state bureau and shared between all insurance carriers. The average modification is 1.00; a good claims history may generate mods below 1.00 while a company with a history of claims may have a mod greater than 1.00.
The payroll figure is based on an estimate of annual payroll.
The Hartford offers two ways for business owners to pay Workers’ Comp premiums. Check out this infographic.
*This is a simplified calculation for reference purposes only and actual premium calculations can be more complex.
Is Workers’ Compensation Insurance Required?
Workers' compensation insurance is required by law in most states and each state's requirements can vary significantly. Specialists at The Hartford can help explain the specific obligations required by each state and help ensure businesses get the coverage they need.
Needlestick Reimbursement Program
If an employee working for a healthcare practice is injured with a needle, this coverage helps pay for initial testing of the employee and the source patient. Afterwards, when the employee consents, it reimburses for subsequent testing – a benefit not offered by all companies.
More Answers to Frequently Asked Workers' Comp Insurance Questions
- What Is Workers' Compensation Insurance?
- Workers' Compensation Cost
- What Does Workers' Comp Cover?
- Types of Workers’ Compensation
- How to Get Workers’ Compensation Insurance
- How to File a Workmans' Comp Claim
- Workers’ Comp Rates Decrease for Fifth Straight Year
- Top 10 Workman’s Comp Questions
- What Is a Workers’ Comp Class Code?
- What to Do If an Employee Is Injured at Work
- Workers' Comp Settlement Process
- How Does Workers' Comp Work?
- Workers' Comp Rights, Rules and Regulations
- Do I Need Workers' Compensation Insurance?
- How Is Workers' Comp Calculated?
- Workers’ Compensation Trends
- Pay-As-You-Go Workers’ Compensation Insurance
- Who Is Exempt From Workers’ Compensation Insurance?
- What Are Workers’ Compensation Benefits?
- Employer Workers’ Compensation Requirements
- Human Resources Role in Workers’ Compensation
- What Should I Look for in a Workers’ Comp Review?
- When Is Workers’ Compensation Required?
- Is Workers’ Compensation Taxable?