Workers’ compensation insurance provides financial protection for employees and employers in case of a work-related injury or illness.
This article covers your business needs about Workers’ Compensation Insurance in Texas.
Workers’ Comp Guide
Workers’ comp is a state-regulated coverage program designed to cover income and medical expenses in the unfortunate circumstance when an employee suffers a workplace-related illness or injury.
What does a workers compensation insurance policy cover?
A workers’ compensation insurance Texas policy includes:
- Occupational illnesses such as chronic lung conditions caused by inhaling hazardous chemicals at the workplace
- Trauma injuries caused by awkward positions or repetitive tasks while working, like a back injury caused by heavy objects lifting
Workers’ compensation covers death benefits, funeral, and burial expenses if an employee dies while working. This type of coverage only applies to injuries and deaths during work.
Should an injury occur from intoxication, self-inflicted, or caused by employee malpractice, they are excluded from any workers’ comp claim.
Employees must also always use their employers’ PPE (Personal Protective Equipment). A hard hat and steel toe-capped shoes are classic examples of this safety equipment.
Failure to use the provided safety equipment will result in a failed comp claim should an employee attempt to sue.
What are the typical benefits of Workers’ Compensation Insurance?
- Medical – covering medical expenses, including doctor visits, hospital stays and surgeries, medications, and rehabilitation
- Disability – both temporary and permanent
- Vocational Rehabilitation – helping the injured employee return to work
- Death – financial compensation, funeral expenses, and ongoing financial support
- Legal Support – assistance with legal expenses
Who Must Carry Workers’ Compensation Insurance?
Not all employers in Texas are obligated to carry workers’ comp insurance. Private employers in Texas don’t need workers’ compensation coverage.
Unlike many other states in the United States, Texas allows employers to choose whether or not to provide workers’ compensation coverage for their employees.
However, businesses that carry workers’ comp insurance are compelled to inform their workforce and post a notice at the workplace with the full details of the insurer.
One can contact the Texas Department of Insurance-Workers’ Comp if they are unsure about the coverage provided.
When can employees covered by workers’ compensation insurance sue their employers?
For employees that workers’ compensation insurance covers, they cannot sue their employers for job-related illnesses or injuries; however, there are some exceptions – for example:
- When injured while working on a ship/boat or when operating a punch-press
- You get sick from asbestos exposure
This means that you can sue even if your employer has workers’ comp coverage and if third parties are at fault.
What Are the Workers’ Compensation Insurance Strategies in Texas?
Employers who carry workers’ comp insurance in Texas must comply with the laws and regulations of the state.
Texas is one of the US states with a unique workers’ compensation system.
Businesses can offer benefits to their workers through the following two worker’s comp insurance strategies:
This is an option for large organizations that meet the state’s financial requirements. The self-insurance strategy is not just for workers’ compensation; it also can be utilized for other business insurances, including property, motor vehicle, product, or cyber liability.
To qualify for self-insurance of workers’ compensation, the business must prove they’ve got the financial ability to pay for the benefits offered to injured workers.
Businesses in Texas should carefully consider the implications of opting out of the state workers’ compensation system and weigh the potential benefits and drawbacks for their specific circumstances. Employers should consult legal and insurance professionals to make informed decisions regarding workers’ compensation coverage.
2. Traditional workers’ compensation insurance
A business needs to purchase workers’ compensation from a company licensed to offer workers’ compensation policies.
Employers must understand the specific regulations and requirements for workers’ compensation insurance in their jurisdiction, as these can vary by location.
Ensure the policy meets the state’s minimum requirements and offers coverage for lost wages, medical expenses, and other losses accumulated through work-related illness or injury.
Workers’ comp offers numerous benefits, which include medical cover, wage replacement, death compensation, and vocational rehabilitation.
While workers’ compensation insurance is not mandatory for all businesses in Texas, there are benefits to having coverage.
Workers’ compensation typically provides a no-fault system, meaning employees can receive benefits for work-related injuries regardless of who is at fault. It also provides some protection for employers against certain types of lawsuits related to workplace injuries.
Remember, if a business fails to meet Texas workers’ compensation requirements, it will face heavy fines and penalties. Additionally, employees should be aware of their rights and the benefits under workers’ compensation coverage.