Who pays workers compensation benefits?
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, larger employers who are clearly solvent are allowed to self-insure or act as their own insurance companies, while smaller companies (with fewer than three or four employees) are not required to carry workers’ compensation insurance at all. 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.
A. Employers are required to purchase insurance for their employees from a workers’ compensation insurance company. In some instances larger employers who are clearly solvent are allowed to self-insure or act as their own insurance company. Some smaller companies (fewer than four or five employees) are not required to carry workers’ compensation. 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.
