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Whether searching for workers comp for electricians, builders, or everyday office workers, you might be curious about what is and isn’t covered. It’s easy to assume you have insurance for all costs associated with a workplace incident or illness, but that might not be true.
You must be fully informed before taking out any insurance policy to understand your coverage levels, and workers’ compensation is no different. By being aware of the following exclusions, you should be able to put a plan in place to limit potential financial and reputational losses.
Injuries in Particular Situations
You might assume that workers’ compensation insurance covers all injuries experienced at a workplace, but there are several exceptions to the rule, including some of the following:
- One-time illnesses like headaches and influenza;
- Pre-existing conditions;
- Ordinary diseases of everyday life;
- Injuries from horseplay;
- Injuries from company policy violations;
- Heart attacks;
- Injuries of employees who started fights;
- Injuries sustained while under the influence or as a result of intoxication or illegal drug use;
- Injuries from off-duty recreational activities.
The Costs to Hire a Replacement
Some workers experience minor injuries and illnesses that only keep them away from work for a few days. Most workplaces will cope without one employee for a short length of time. However, more severe workplace injuries can require several weeks or months off work, and their skillset might be needed long before they’ve recovered enough to return.
In that case, you might need to hire a temporary replacement worker to take over their job and fill the productivity gaps in your business. It’s easy to assume that your workers’ compensation insurance will cover a new employee’s onboarding, training, and wages, but it doesn’t. Your insurance will care for your unwell employee, but the costs associated with their replacement must come out of your own pocket.
Health and Safety Fees and Penalties
Many accidents and illnesses in the workplace can’t be attributed to any particular health and safety failing, but some can be. If the Occupational Safety and Health Administration (OSHA) believes you failed to keep your workers safe, you might receive fines totaling tens of thousands and even hundreds of thousands of dollars.
Workers’ compensation insurance doesn’t cover OSHA violations or any associated fees and penalties. Businesses typically must cover these costs themselves.
Workplace Safety Upgrades
If a workplace safety issue results in an employee being injured or becoming unwell, your workers’ compensation insurance won’t cover the costs associated with fixing that issue.
For example, if a broken guardrail causes an employee to fall down the stairs, you won’t receive funds from your insurance provider to install a new one. The onus is on the business owner to rectify any potential health and safety issues before they lead to an illness or injury.
Damage to Third Parties
Your employees aren’t always the only parties involved in a workplace accident or injury. Sometimes, so are members of the public or their property. For example, an employee might trip while carrying something for a customer, only to fall over and hit the customer with the item.
Workers’ compensation insurance will cover injuries to your employee, but it won’t extend to the customer’s damage or the financial loss of their purchase. Fortunately, you can purchase public liability insurance for situations like these.
Workers’ compensation insurance is a necessary form of coverage for the costs associated with worker illness and injury. However, it won’t cover everything. Understand the most common exclusions, and put yourself in a strong position to plan for possible financial shortfalls.
You may also like: How to Improve Health and Safety at Work
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