When someone on a job site ends up getting injured, most people assume workers’ compensation insurance needs to be looked into for claims purposes. While this may be a correct hunch in most situations, there are actually some types of claims that require another course of action, occupational accident insurance.
Occupational accident insurance provides coverage similar to workers’ compensation insurance, but for independent contractors and employees not covered under a workers’ compensation program. The insurance coverage needed depends on the workforce, the risk that’s willing to be assumed, and the laws of your state. Here are some things to consider when trying to differentiate between the two types of coverage.
Occupational Accident Insurance
This kind of coverage does provide coverage to a certain degree when it comes to accidents or injuries while a person is working. It’s an optional piece of protection that usually costs about 50 percent less than a typical workers’ comp plan. It may fit companies that don’t necessarily need all the benefits of a traditional and comprehensive workers’ comp program.
Occupational accident insurance provides coverage for things like lost wages, medical expenses, and death benefits up to whatever the policy limit is. What’s more, businesses can choose the deductible, limits, and coverage for disability.
However, occupational accident insurance typically provides little for legal expenses, which can be a major cost in any claim. This can be a major financial risk for business owners who choose this option over workers’ compensation coverage.
For employers, they are responsible for any type of legal obligation to an employee who is not covered by an occupational accident insurance plan. The upfront cost is lower, yes, but it means less is covered altogether, which only means business owners may come up short financially during a claim. By choosing the wrong type or level of coverage, business owners could be exposing themselves to major financial obligations beyond what they can take on.
Employers will bear the burden of proof in a lawsuit, which means the business must prove that the injury or illness involved in a claim is no longer the cause of the person’s condition. Lawsuits by people who make a claim like this are usually lengthy, complex, and altogether costly. It is important for a business owner to have the right policy limit in order to cover claims and pay any costs.
Workers’ Compensation Insurance
Most business owners usually opt for workers’ compensation coverage when it comes to protection. There are several reasons to go this route compared to occupational accident insurance, and they mostly have to do with financial reasons, which is understandable.
Workers’ comp is a state-regulated coverage and pays certain lost wages and all medical expenses. Payouts for worker injuries and deaths meet at least minimum requirements and they can also exceed limits in a policy.
The burden of proof, under workers’ comp, lies with the worker, not the employer, as compared to occupational accident insurance. The plaintiff in question must prove the injury or illness caused their condition. Under workers’ compensation laws, someone cannot sue for any pain and suffering and cannot receive a judgment for punitive damages.
InsureMyWorkComp is a digital brokerage that helps clients find the right workers’ compensation solution for their business needs. Unlike other online platforms, we will help you to work with an agent who can provide you the right solution for your risk profile. Our staff has over 50 years of workers’ compensation underwriting and sales experience, and we are confident that we will provide you the support that you need. For more information or to get a quote, contact us today at (855) 340-9138.