Workers Compensation, also known as Workers Comp or Employers Liability, is a special coverage which covers your employees should they get injured on the job. How does it work? If they are injured workers compensation will pay medical bills.
Workers Comp also have a liability component in it which protects your business if it is sued by an employees after they are injured.
Workers Compensation has two parts..
Coverage A – Workers Compensation agrees to pay the benefits required under the Workers Compensation Law.
Coverage B – Employers Liability provides coverage for your legal liability to employees.
Hired employees are generally who would be covered under this policy. If it is possible you might sub-contract certain operations, compensation laws provide that the principal contractor is responsible for Workers Compensation for the employees of uninsured sub-contractors. In determining Workers Compensation premiums, you will be charged for coverage in connection with employees of sub-contractors, unless the sub-contractors have insured this obligation and have furnished satisfactory evidence of such insurance. You should always obtain certificates of insurance from all sub-contractors doing work for you.
In the event a minor employed by you is injured, Workers Compensation may assess additional “punitive” damages equal to or greater than the basic award. These punitive damages are not covered by your policy . . . you are urged to consider your present employees and examine future applications carefully from this standpoint.
Volunteers are not covered under a Workers Compensation policy.
In some states, coverage can be provided for employees occasionally working in other states by the addition of an “all states” endorsement. The Workers Compensation policy is always written subject to audit, and payroll records should be kept in such a manner as to show any overtime paid.
Every policy is different and your individual needs and situation will impact the type of policy you will get and the coverage that will be offered.