Workers Compensation | Meaning and Definition

What is workers’ compensation? 

Workers’ compensation insurance can be defined as a type of commercial insurance. Employees who are wounded or ill on the job are eligible for benefits. Workers’ compensation aids in the payment of:

•       Medical attention
•       Wages lost owing to time off work due to injury or illness
•       If necessary, vocational rehabilitation
•       If a work-related incident becomes fatal, death payments are available.

Workers’ compensation is intended to protect both employers and employees’ interests. Employees who get these benefits typically waive their right to sue their company. However, there are certain exceptions.

Who is in charge of Workers’ Compensation? 

Workers’ compensation is administered by each state separately. Premium rates, benefit amounts, and other factors are determined by the state, whether state agencies or private insurers sell insurance.

Most employees working for just a privately owned corporation or for local or state government are covered by state workers’ compensation systems. Because laws differ by state, it’s critical to familiarize yourself with the rules and standards in each state where your workers operate. Here are links to the workers’ compensation offices in each state. Workers’ compensation programs run by the US Department of Labor protect federal employees and certain other employees.

Workers’ Compensation Insurance Is Required for Whom? 

This is for all the employers in most states who are actually required to provide workers’ compensation coverage to their workers.