Best Workers Comp Insurance for Small Business

Does your company have a workers compensation insurance policy? Workers compensation helps pay for work-related injuries or illnesses. In 2019 and ’20, the most costly lost-time workers comp claims resulted from motor-vehicle accidents. Those cost an average of $85,311 per claim, according to the National Safety Council (NSC).¹ Other most-costly claim types included burns, slips and falls, and workers being “caught” by objects and machinery. Without a valid and active workers compensation policy, you could be forced to pay those expenses from your business finances. In this article, we’ll discuss choosing the best workers comp insurance for small business.

What is workers compensation in insurance?

Workers compensation insurance, a.k.a. workman’s comp, is a type of business insurance. It helps pay for injuries and illnesses that occur on or as a result of the job. These policies cover:

• Medical expenses. Pays for medical treatment that is required after a direct work-related injury or illness. This includes exams, medications, and surgeries, and visits to a doctor, urgent care, or emergency room.
• Lost wages. Helps pay for part of the employee’s lost wages while they recover from their injury or illness.
• Ongoing care. Helps pay for vocational rehabilitation, physical therapy and other ongoing care needs.
• Disability. If workers become temporarily or permanently disabled due to a workplace injury, workman’s compensation insurance helps pay for ongoing care. It also replaces some lost wages while the individual is disabled. This is also referred to as short-term and long-term disability.
• Funeral expenses. Helps pay the funeral expenses of an employee who is killed on the job. It may also pay death benefits for the employee’s spouse and/or immediate family members.

Does your small business need workers compensation insurance?

Even if your workforce works from home, it’s important to have a workers compensation policy. This is because workers comp also pays for repetitive motion injuries, including carpal tunnel, tennis elbow, tendonitis, and trigger finger. Other common workplace injuries include being struck by or striking an object, burns, cuts, amputations, concussions, and fractures. And these injuries are not cheap to treat. According to NSC, the following types of injuries cost an average of:

• Amputations: $118,837 per claim.
• Burns: $48,671 per claim.
• Contusions/concussions: $33,151 per claim.
• Fractures/crushings/dislocations: $60,934 per claim.
• Striking an object: $30,417 per claim.
• Struck by an object: $39,977 per claim.

Without workers comp insurance, you or your business could be sued by your employee and forced to pay expenses. For small businesses, a single claim could put them out of business. So to protect your business and its financial future, it’s important to find the best workers compensation policy for you.

Choosing the best workers comp insurance for small business protection

The best workers comp policy is one that covers injuries related to your specific business and that you can afford. To start the process, research workers compensation insurance companies and get detailed quotes. You can begin with the following popular workers comp insurance providers:

• The Hartford: known as a great insurance provider for companies in the medical field.
• Nationwide: known as a great insurance provider for companies in the construction industry.
• Progressive: known for being among the best if your company works from professional offices.

When considering insurance providers that offer workers compensation coverage, pay attention to details about how they operate and handle claims. Ideally, you’ll want to choose an insurance broker or company that offers:

• The ability to file claims 24 hours a day, 7 days a week.
• Flexible payment options or pay-as-you-go insurance coverage.
• 24/7 customer service.

How much does workers compensation insurance cost?

Workers compensation insurance costs vary by state, industry and number of employees. According to Insureon, recent rates range from 52 cents to $1.98 per $100 in employee wages. Some states will analyze workers comp data and recommend rates. But most states rely on information provided by the National Council on Compensation Insurance (NCCI). Cost factors include:

• Amount of your payroll: how much you pay for your entire employee payroll.
• Business industry: the type of industry you work in and the associated employee-injury risks.
• Past claims history: how many workers compensation claims you’ve had in the past.
• Type of work: the type of work your employees perform on a day-to-day basis and the risks associated with it.
• Insurance discounts: Some insurance companies may offer discounts if you have more than one policy with the company. For example, if you bundle workers compensation and business liability insurances or a business owner’s policy. These discounts are often known as multi-line discounts or bundling.

The best workers compensation insurance policy is one that’s affordable and covers the costs associated with on-the-job employee injuries, death and illness. Before choosing one for your small business, be sure to understand and compare all the details. These include limitations regarding medical costs per incident and policy term, and full and partial disability benefits, death benefits and lost wages coverage.

Make sure your preferred provider and policy suit all your needs. Once you find the right fit, you’ll pay the premiums and receive all your insurance coverage paperwork.

For more information on workers compensation and other essential business insurances, head to Workest by Zenefits.

1 National Safety Council, Workers Compensation Costs