Starting a Business? What You Need to Know About Workers’ Compensation


If you’re starting a new business or running a young one, you may not have thought much about workers’ compensation. However, this is an incredibly important topic to address as a business owner. If you fail to get the right workers’ compensation plan to protect your business, you could possibly find yourself losing everything if one of your employees is injured on the job and decides to file a workers’ compensation claim against your company.

5 Things You Need to Start a New Business

So, let’s take a quick look at workers’ compensation. Let’s examine what it is, how it works, why you need workers’ compensation insurance as a business owner, and how to pick the right workers’ compensation insurance for your company.

So, what is workers’ compensation? As VA Beach personal injury attorney Robert J Haddad explains, workers’ compensation laws basically make sure that employers take reasonable care to ensure that their employees are safe on the job. These laws ensure that workers who contract illnesses on the job or workers who suffer injuries on the job get the compensation they need to pay for medical bills, time unable to work, etc. While all states have laws regarding workers’ compensation, the laws for companies vary from state-to-state. If you’re starting a business and planning on hiring employees, you need to check the laws in your state to see if you are required to purchase workers’ compensation insurance for your business, and if so, how much and what type you are supposed to purchase.

There are two main reasons employers need to get workers’ compensation insurance. The first is that they need to comply with state laws in order to avoid having to pay penalties later on. The second is to actually protect their business in the case that a worker is injured and files a claim. Workers’ compensation claims can be hefty enough to drive a company to bankruptcy without insurance, so every employer needs to make sure they are covered in the event of a serious accident or illness.

With this in mind, how do you get workers’ compensation insurance and where do you purchase it? Well, you will most likely purchase your workers’ compensation insurance separately from your business owners’ insurance policy. You will have to check your state laws to see if workers’ compensation is provided by the state, by private insurance companies, or by both. While private insurance options can tend to provide better coverage, if you’re having a hard time finding coverage for your business, you may want to look into state fund coverage (if you live in a state that offers this.)

If you live in a state where you can purchase your insurance through a private company, then you need to take the time to find the best provider possible. As Ronald Rosen, a FL slip and fall lawyer recommends, don’t just go with the first company you get a quote from. Get quotes from several of the top-rated companies in your area, then compare. The cost of your coverage will depend on the type of business you own and the number of employees you have. If you want to make the cost of the insurance easier for your business to handle you can find a company that offers you a pay-as-you-go billing process. This will allow you to pay your premium charges after each payroll instead of making large payments upfront.

While workers’ compensation can be a confusing topic for new business owners, don’t let it intimidate you. As St. Louis wrongful death attorney Benjamin Sansone explains, workers’ compensation insurance is there to protect both you and your employees from unexpected accidents and illnesses, so it is actually a positive thing. Just make sure you look at the laws and your state, and then choose a good insurance policy or state offered policy accordingly, and you will be protecting your business for the long term.