General Information on Workers Compensation Claims

Many big insurers shy away from offering Workers' Compensation insurance to small businesses. Not Berger & O'Neal Insurance Group.

While the coverage included in any Workers' Compensation policy is largely mandated by state statute, Berger & O'Neal Insurance distinguishes its policy by going beyond those requirements to expand coverage in several key areas. Better yet, we complement those expanded coverages with exceptional claims handling and a variety of cost containment services.

What Is Workers' Compensation -- And Workers' Compensation Insurance

In general, the current Workers' Compensation system represents a compromise between employers and employees regarding employment-related injuries or illnesses. Basically, employees relinquish their right to sue employers if they suffer some job-related injury or illness. In return, employers agree to provide state-mandated benefits if such injuries or illnesses occur.

To ensure employers will have the money to pay these mandated benefits, most states require that employers demonstrate that they have the financial ability to pay any claims that may arise. Typically, this financial ability is demonstrated through the purchase of Workers' Compensation insurance.

Most Workers' Compensation insurance policies actually provide two types of coverage:

• Workers' Compensation Coverage. Pure Workers' Compensation coverage provides benefits for injured workers as required by state law -- regardless of who is at fault for the injury or illness. In other words, whatever benefits your state requires that employers provide for injured workers, your Workers' Compensation policy provides.
• Employer's Liability Coverage. This additional coverage provides employers with liability protection in case they are ever sued for damages arising from employment-related accidents or diseases. However, to collect benefits provided by Employer's Liability Coverage, both the employee as well as anyone else not covered by workers' compensation laws (i.e. spouses and dependents), would have to prove that the employer was actually legally responsible for the employee's injury or disease.

Who This Policy Will Cover?

In general, Workers' Compensation insurance is designed to provide benefits for your employees. However, the individuals that are defined as employees are determined by state law. And in Workers' Compensation cases, courts have typically been very liberal in their definition of employees, so as to provide injured workers with broad protection under the state's Workers' Compensation laws.

The Employer's Liability insurance included in your Workers' Compensation policy can also provide damages to injured workers separate from their Workers' Compensation benefits. Family members and other third party claimants may also receive benefits under this coverage -- if they prove the employer's legal liability.

What Expenses This Policy May Pay?

Typically, your Workers' Compensation policy will pay for:

• Medical benefits for a covered injury or disease -- including medical, hospital, surgical and other related health care costs as well as physical therapy and prosthetic devices
• Disability income benefits - including compensation for lost wages
• Rehabilitation benefits - including services to help an injured worker return to productive work, such as vocational rehabilitation
• Death benefits - including a flat amount for burial expenses as well as partial replacement of the worker's weekly wage.

What Protection This Policy Offers?

If one of your employees is accidentally injured while on the job, your Workers' Compensation policy will pay for a wide range of services to aid the injured worker's recovery and return to productive work. These services can include the cost of medical care, compensation for lost wages, and rehabilitation therapy.

If your employee is accidentally killed while on the job, your policy will also provide death benefits -- including burial expenses and partial replacement of the worker's weekly wage.

Occupational Illnesses

If some condition in your working environment actually causes one of your employees to become ill or contract a work-related disease, your Workers' Compensation policy will provide a wide range of benefits to help treat this illness and speed the employee's recovery. These benefits will typically cover the cost of medical care, compensation for lost wages, and other required therapy.

If your employee dies from this disease, your policy will also provide death benefits -- including burial expenses and partial replacement of the worker's weekly wage.

Coverage for Employees Not Subject to Workers' Compensation Laws

Most Workers' Compensation policies only provide benefits for those employees your state specifically identifies as subject to workers' compensation laws. But some policies goes beyond this requirement. It automatically extends bodily injury coverage to employees who aren't expressly covered by your state's Workers' Compensation laws -- such as volunteers. (Not available in Wisconsin and New Jersey.)

Liability Suits Related to an Employee Injury

To recover benefits under your state's Workers' Compensation law, your employees don't have to prove you were somehow responsible for their employment-related accident or disease. But if they can prove you were liable for their accident or illness, they may be able to successfully sue to recover damages beyond the Workers' Compensation benefits.

If so, you'll be comforted to know that the Employer's Liability portion of your Workers' Compensation policy can pay for the damages awarded to your injured employee -- as well as the legal expenses involved in such a suit. This coverage may also provide certain benefits if you are ever sued by a third party affected by a workplace injury, such as a family member of the injured worker.

Expenses You Incur as Part of a Workers' Compensation Claim

If you are ever involved in a Workers' Compensation claim, proceeding, or suit, most Workers' Compensation policies will pay for any reasonable expenses you incur at our request to participate in these proceedings or help prepare your defense. In fact, we'll even pay for any earnings you lose because of these activities -- a benefit most standard Workers' Compensation policies do not offer.

Legal Expenses in Workers' Compensation Cases

If you are protected by Workers' Compensation policy, you generally won't have to worry about bearing any legal expenses related to a Workers' Compensation or Employer's Liability claim. In fact, we will assume the responsibility of investigating, defending and settling any related claims, proceedings or suits. We will also supply the services of an attorney to represent you in any such suit. In short, we will:

• Pay the cost of defending you in any hearings, suits, etc, that result from any occurrences covered by Workers' Compensation; and
• Pay damages if you are successfully sued because of a job-related injury or disease.

Compensation for Family Members

If an injured worker's family members can prove that you were legally liable for a work-related injury or illness, they may be able to collect damages from you. In such cases, the Employer's Liability coverage provided by your policy may pay for:

• compensation for family members for their "loss of consortium" or access to the injured worker; and
• damages for injuries to spouses or relatives that result from the injury to the spouse or relative.

Coverages for Employees While Traveling on Business

Most Workers' Compensation policies only provide coverage for the states in which you do business, as specified in your actual policy. Therefore, check your policy if it extends its Workers' Compensation coverage to employees traveling outside the standard policy territory (excluding U.S., Canada, Cuba, Iran, Iraq, Kampuchea, North Korea, Libya, and Lebanon).

Accidents Over Navigable Waterways

If any of your employees ever have an accident while carrying out their job responsibilities over a navigable waterway, they may be subject to the workers' compensation benefits provided by the United States Longshore and Harbor Workers Compensation Act. Typically, benefits mandated by this act are more extensive than those provided under a state's Workers' Compensation law.

Employer's Liability in Monopolistic States (NV, OH, WA, WV, WY)

In six states, the state governments mandate that employers purchase Workers' Compensation insurance from the state fund. Referred to as "monopolistic states", these states don't even allow insurance companies to sell Workers' Compensation to employers headquartered within their borders.

Even if your business isn't domiciled in one of these states, you could still be affected by their laws. If one of your employees is injured in any of these states and decides to file a Workers' Compensation claim, that state's laws would apply. In such a situation, you'll be reassured to know that most Workers Compensation policies automatically provide "employer's liability" coverage. This coverage would pay for related expenses and damages in case you are ever sued for the employment-related injury or illness. Other insurers may offer this extended coverage in these states -- but only if you specifically request that they add it to your policy.

Third Party Suits Against the Employer

If your employees are injured in an accident, they may try to sue a "third party" (a company other than yours) -- if they believe that party is somehow responsible for their injury. In turn, that third party may sue you -- if it believes your company is legally liable for the accident.

For example, an employee injured while using a piece of equipment may sue the equipment manufacturer for some alleged negligence or faulty design. However, the manufacturer can then turn around and sue your company -- if they believe the accident was instead caused by your improper maintenance of the equipment.

In this situation, the Employer's Liability coverage of your policy would pay any damages awarded by the court to compensate for the bodily injury.

Failure to Notify Insurer of Potential Hazards

When you apply for a Workers' Compensation policy, you have an obligation to disclose to the insurer all known hazards. But what if you don't even know you have a potential hazard at your business site? Unlike other policies, our Workers' Compensation policy explicitly states that we won't deny coverage if something happens as a result of that undisclosed hazard -- as long as you did not intentionally fail to notify us of its existence.

Investigation into Workers' Compensation Fraud

Unfortunately, fraudulent claims add to every employer's workers' compensation costs. And since most insurance companies are serious about helping you control costs, we're serious about fighting fraud. Our claim professionals can also coach you on how to spot and handle a potentially fraudulent claim.