Workers Compensation FAQs

If an employee is injured and it’s their fault, are they still eligible to collect workers compensation?
Yes. Workers compensation is no-fault, meaning that if an employee is injured on the job, they are still entitled to compensation (even if they caused their own injury).

What does workers compensation insurance cover?
Workers compensation insurance covers the medical costs and lost wages associated with two main categories of work-related injury and illness – injury, illness, or death occurring from an isolated incident, and injury or illness that has developed over a period of time due to work environment or the work itself. However, it is more difficult to collect workers compensation in the case of the latter category, as it is harder to prove that an injury or illness was not augmented by outside-the-job factors, such as personal issues and prior medical conditions.

How does workers compensation insurance protect businesses?
Workers compensation insurance prevents a business from being sued for damages, medical bills, and lost wages in the event that an employee is injured on the job. The employer’s liability coverage portion of your policy specifically protects your company by covering legal fees and awarded settlements if it is determined that the workplace was unsafe due to negligence.

Do I need to have workers compensation insurance for my business?
Most states require that companies with W2 employees have workers compensation insurance and some states also require that companies with 1099 contractor employees have workers compensation insurance. Many people who hire contractors will require that the contractors are covered, regardless of their state’s law.

Do I need to have worker’s compensation insurance if I am the owner and only employee of my business?
It depends on the state in which you are operating your business. However, if you’re hired as a contractor or a subcontractor, the company that is hiring you could be responsible for your workers compensation if you are injured (this also depends on state law). Thus the hiring company may require that you carry your own workers compensation insurance.