Who pays workers compensation benefits?
Worker’s compensation insurance companies sell policies to employers, who are required to carry coverage for their employees. Businesses with 3 or fewer employees may not be legally required to carry worker’s compensation. When an injury occurs on the job, the insurance company must hold up its contractual obligations and pay out worker’s compensation benefits. When valid claims are denied, an experienced worker’s compensation attorney can help the insurance companies pay what’s fair.
In most states, employers are required to purchase insurance for their employees from a workers’ compensation insurance company (also called an insurance carrier). In some states, however, very small companies (with fewer than three or four employees) are not required to carry workers’ compensation insurance. In some states, larger employers who are clearly financially stable are allowed to act as their own workers’ compensation insurance companies (also called self-insuring). When a worker is injured, his or her claim is filed with the insurance company — or self-insuring employer — who pays medical and disability benefits according to a state-approved formula.
In most states, employers are required to purchase insurance for their employees from a workers’ compensation insurance carrier. In some states, larger employers who are clearly solvent are allowed to self-insure, or act as their own insurance companies. When a worker is injured, his or her claim is filed with the workers’ compensation carrier, or the self-insuring employer, who pays medical and disability benefits according to a state-approved formula. It is noteworthy that some smaller companies (with fewer than three or four employees) are not required to carry workers’ compensation insurance at all.
