Employers are frequently held financially responsible for any work-related injuries or illnesses that their employees suffer. Generally, employers are expected to compensate hurt or sick employees for both the medical costs and the lost wages that result from an on-the-job incident. Workers compensation insurance generally helps Massachusetts businesses that employ workers manage covered potential costs like these.
Workers compensation insurance may be purchased by employers, but this is one form of insurance that benefits multiple parties. While employers get protection against covered potential costs that could otherwise be financially devastating, employees get the reassurance that they’ll be compensated fairly if their work ever causes harm.
State law requires most businesses in Massachusetts that have employees to purchase a workers compensation policy that covers their employees. Employees normally need to be covered regardless of how many hours they work, what their position is and how long they’ve been with a company.
Businesses that don’t have employees might not be legally required to purchase a workers compensation policy. Before business owners who don’t have employees decide to forgo this protection, however, they should first talk with an insurance agent who specializes in workers comp.
Business owners might want a workers compensation policy to protect themselves even if they’re not an employee. Health insurance policies sometimes exclude work-related injuries from their coverages, and such an exclusion could leave a business owner who’s seriously hurt while working with expensive medical bills. Workers comp might cover such an injury if a health insurance policy doesn’t.
Additionally, a few businesses that hire subcontractors might have to provide workers comp for those subcontractors. This is fairly uncommon and highly situationally specific, but business owners should make sure they don’t have to adhere to such a requirement so that they aren’t faced with legal consequences. An informed insurance agent can help business owners sort through their particular situation and any accompanying requirements.
As is the case with most insurance policies, the premiums charged for workers compensation policies vary. Some of the items that insurers often consider when setting rates are the number of employees a business has, what those employees make and what those employees do.
While costs vary, purchasing a policy is almost certainly cheaper than facing the legal consequences of not having coverage. An independent insurance agent can help business owners find out exactly how much a policy would cost their business.
Conducting a workers compensation audit is a fairly standard practice, and it’s not one that should scare business owners too much. The purpose of an audit is generally to make sure a business paid the right premium for their policy.
The premiums quoted when policies are purchased normally are only estimates. They’re based on information provided by the business that’s getting coverage, but even the most thorough and honest business can’t always forecast a year’s payroll expenses. Employees transition in and out of jobs, and they get pay raises and decreases.
To make sure the premiums assessed were accurate, an insurance company will often want to audit a business’ books when the business’ workers compensation policy is renewed. The insurance company will check how much employees were paid, and premium adjustments will be made if necessary. Businesses sometimes get a bill for any balance due, and they sometimes get refunds for overpaid premiums.
As long as a business’ books are complete and updated, the audit process is fairly simple.
For help getting workers compensation insurance for your business, contact Dempsey Insurance. Our team of independent agents has helped many Massachusetts businesses find affordable workers compensation policies that provide the coverage they need, and we’d be happy to assist you.