If you are having a job right now, you might have heard about the workmen's compensation insurance and its benefits. However, if you do not know how it works, you might not be able to make most of the insurance plan in the time of need. Getting to know about the compensation law and how it works ahead of time can help you in a great way to decide if you need to claim one and how to get through it. This guide is going to help you to understand how workmen' compensation insurance works with some other important information.
What is Workmen's Compensation?
The workmen's compensation is the oldest insurance plan in the United States of America. Workers can get benefits through this if they get injured during their jobs. Workers can also get partial wages while they recover from injuries. Many states in the US have made it compulsory by law for businesses to buy the workmen's compensation plans. The implementation of this law can differ in different states.
Workers often suffer injuries and illness on the job while having different tasks and activities. In past, many workers faced problems such as loss of wages, looking for another job, or staying home with lifelong disabilities without getting any compensation. All this happened because workers had to prove in the court of law about the unsafe working condition. Employers also faced problems of frequent lawsuits which damaged goodwill of their businesses.
Since many workers could not afford the costs of taking legal action against their employers, the labor unions demanded insurance for workers' compensation. In 1949, it became compulsory for the employers in the US to provide some kind of compensation or insurance to their workers under the law. The law benefited both workers and employers. The workers were able to get compensation for the injuries while employers got a relief from frequent lawsuits.
Today, workmen's compensation insurance provides workers money for the loss of wages, repayments for the medical expenses, and a life insurance plan for the dependents of workers. All these facilities in the compensation insurance can vary in different states and with the kind of injury and illness.
How does the Workmen's Compensation Insurance Work?
In case any worker gets injured or suffers illness, he/ she need to inform the employer. Since it is the employer who will be bearing the cost, he/she needs to be informed about the entire incident. The reporting timelines differ for each state. A reporting timeline is a duration in which workers can apply for an injury claim from their employers. So make sure that you report before the time runs away as you might lose the workers' compensation insurance. Once the suffering has been reported, the employers and workers can take the given steps:
- Getting medical help from an approved health care professional: The injured or ill workers need to get medical check-up without any delays. Delays can risk their health and can increase the chances of major illness or permanent disabilities. Workers can get a medical report from the doctor to file an employee injury claim.
- Starting the claim process: Get the work injury claim form from the employer. The claim form is a document which is needed to be filled to claim injury compensation from the employer. Employers are responsible for providing important details, it will be important to provide them with correct and necessary details. Information like the process and the details about the insurance company hired by the organization.
- Filing the claim: Workers can then file a claim for injury or illness with the insurance company mentioned by the employer. The claim can be filed by submitting documents such as medical report and other legal documents which can differ in different states. Make sure you keep a track on the reporting deadlines.
- Receiving the compensation: As the insurance company approves the claim, workers can start receiving the workmen's compensation benefits. The benefits might also include a two-third of their wages for the time workers are not able to work.
- Getting back to work: Workers can get back to work based on the recommendations of the doctor. The employers should make enough arrangements to help the worker to get settled on the work. Employers may also arrange any safety training to avoid such injuries again.
Which Injuries are covered in the Compensation Insurance?
The workmen's compensation is meant to compensate workers for injuries and problems happened during the work time. This compensation can also be given to the workers who get injured outside the workplace if they are completing any given task on the request of their employer. Injuries caused during traveling from home to work may not be counted in the compensation plan.
Employers can also take alcohol and drug tests of employees after an incident or injury occurred. This is taken to ensure that employee may not blame the employer for an injury caused by their own negligence.
Workmen's Compensation in Numbers
So far the workers' compensation program has benefited many workers in the US. The impact of the program can be seen from the table above. The table shows the number of workers who availed the insurance and the total wages. Other than this, the total compensation benefits amounted around $56 billion in the year 2004 in the US.
Many workers in 2001 received permanent disability benefits which were 12% of total compensations. This means many employees do not suffer permanent injuries, yet one can be sure that they are not going to be left alone in case of a permanent injury.
Classifications of Workers' Compensation Insurance
The compensation insurance is based on a classification system. This helps to divide the insurance cost fairly among the employers. The system is created to make sure that companies with higher risk work get more insurance compensation than the ones working in low-risk conditions. The classification system is developed by the National Council on Compensation Insurance (NCCI). The businesses are classified into the following category:
- Basic Classifications
- Standard Exceptions
- Governing Classification
- General Exclusions
- General Inclusions
How Compensation Premiums are calculated?
There are two main factors that are used to calculate workmen's compensation premiums, i.e., the insurance rates and payrolls (wages). The payrolls are subdivided into different class codes that are used with the insurance rates to calculate the premium (amount) of benefits provided to the workers.
How to Make Sure Your Worker's Compensation is Provided Fairly?
Accepting the workers' compensation can be a good choice as many employers try to avoid any legal action against the incident. Thus, they try to provide the best possible compensation to their workers. But, each case is different and can bring different problems for the employee. Hence, it should be important to get enough information about the compensation insurance.
One authorized resource to refer can be the official website of Workers' Compensation Insurance. This can help you to find workers' compensation laws of your state and guide you with the process of availing the facility.
The workmen's compensation insurance helps workers to get compensated from their employers for any injury or illness caused by any work-related activity. All you need to make sure that you understand how the insurance work and follow the guidelines provided by your respective state laws. You may also need to keep a track of the reporting deadlines and important documents such as medical reports to be able to claim compensation.
There are different kinds of injuries covered under the compensation insurance and various benefits are provided to the workers based on the medical reports and doctor's recommendation. You may check and refer to the official website of the compensation insurance to understand the procedure in a better way and to see that you have been compensated adequately.