Workers’ compensation (comp) insurance is often considered a necessity in business today. According to the US Bureau of Labor Statistics, in 2015, 2.9 million workplace-related injuries and illnesses occurred in the private industry alone. This figure does not include workplace fatalities. Workers’ comp protects both the employee and the employer in many ways. If you do not yet offer workers’ compensation to your employees, below is a helpful guide filled with information from which types of businesses are required to provide this type of insurance to potential issues if you do not have it.
Workers’ Compensation Insurance
The purpose of Connecticut workers compensation insurance is to provide coverage to employees who are injured while working on the job. This insurance also provides coverage to individuals who become ill, disabled or killed on the job. Such injuries could occur anywhere from a warehouse to an office. If an injury were to occur, the insurance would cover the rehabilitation and medical costs incurred by the employee. It will also cover a certain portion of their lost wages.
When you have workers comp insurance, you are protected, as well. As a result of providing this benefit, any employee who does become injured on the job waives the ability to be able to sue you and your company for negligence. In addition to both parties being protected, it will also help protect the relationship of you and your employee by not having to deal with legal proceedings.
Workers’ Comp in Connecticut
It is important to note that each state and business type has unique requirements. Connecticut workers compensation insurance is no exception. The National Council on Compensation Commission in Connecticut will determine the risk classifications used to calculate premiums. And, the Connecticut Workers’ Compensation Commission is responsible for overseeing the licensing, managing and all matters related to workplace injuries and comp insurance throughout the state.
While having comp insurance does greatly protect you, some instances due occur that may cause a dispute. This could be that the insurance does not cover all medical expenses incurred by the employee or perhaps that the insurance company does not pay promptly. In Connecticut, if there is a dispute, the Connecticut Workers’ Compensation Commission is responsible for determining the outcome. They will work with both parties to reach an amicable agreement; however, if one is unable to be found, they will hear the proceedings and make rulings and settlement awards. They will also review potential fraudulent claims.
How Much Does Workers’ Comp Insurance Cost?
The good news about premium costs of such compensation is that it varies based on the risk classification. This classification is based on the severity of the injury and the number of times injuries occur on the job. This classification cost will then be multiplied by a certain percentage for each $100 of the employee’s wages. The classification could also be affected by the type of job the individual performs, as well as the size of the payroll of the employer. It should also be noted that the type of business you have will also contribute to the overall cost of the premium. Basically, if you have a business that is based solely out of an office space you will have lower premiums than a business that manufactures products with potentially hazardous materials or machines.
You can reduce premiums in several ways. If you provide health insurance to your employees, you could have lower premiums. If you have an exceptional safety record, this can also contribute to a decrease in your costs. It is important to create safety procedures and to demonstrate proper safety training to all employees to minimize injury and to reduce your risk.
Where to Buy
Connecticut provides two options for purchasing compensation insurance. The first is that you can opt to provide self-insurance. This type of liability comp insurance is offered directly by the employer rather than through a commercial carrier. Any business that wishes to pursue this route must apply and be approved by the Compensation Commission.
The alternative is to purchase the insurance through commercial insurance carriers. Connecticut is home to several reputable providers that can provide cost-effective solutions. Keep in mind that some insurance carriers only provide coverage to specific types or sizes of business. If you are a small or medium business, be sure to seek out providers that specialize in and understand your size and type of business.
Potential Issues Without Comp Insurance
In Connecticut, any business with employees of one or more are required to provide workers comp insurance. These employees could be contract, part-time or full-time. It is important to note that subcontractors who are uninsured are also included as an employee required to be covered. Those who are able to self-insure and any sole proprietor are the exceptions.
Be sure that when you select a carrier that they are legally licensed to operate in Connecticut. While the insurance company does not have to be based out of Connecticut, they must have the proper licensing to provide insurance to local Connecticut businesses.
If you do not provide the appropriate insurance coverage, you could face a number of consequences. The most discerning possible outcome is that a lawsuit could bankrupt your business. The amount you would have to pay in insurance is likely inconsequential compared to the possible end results of a settlement award you simply cannot afford. If you have the proper insurance, you and your employees can go about your days with peace of mind, which can have a significant impact on job satisfaction and productivity. You can also face up to a $5,000 penalty from the state if you do not remain in good standing and provide adequate coverage with your workers’ compensation insurance.
If you still have questions, please contact or review the website of the Connecticut Workers’ Compensation Commission. Do not forget that Connecticut law requires you to post notice that worker’s compensation is available to your employees. And, if you take a few simple steps to improve your workplace safety, you will greatly minimize your risk and premiums on your Connecticut workers compensation insurance.
Sources:
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http://wcc.state.ct.us/
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http://www.nfib.com/content/resources/labor/workers-compensation-insurance-what-it-is-and-why-your-small-business-needs-it-56417/
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https://www.jud.ct.gov/lawlib/law/workerscomp.htm
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https://www.bls.gov/iif/