Workers’ compensation is a type of insurance that pays for employee medical treatments in the event of a workplace injury or illness. In some jurisdictions, it’s required coverage for businesses, so many employers need a deeper understanding of this type of insurance. Below are the answers to some of the most frequently asked questions about workers’ comp.

The Workers’ Compensation FAQ

Which businesses must have this type of insurance?

In North Carolina, if your business has three or more employees, you must purchase workers’ compensation. Some exceptions apply, including household domestic servants, certain farm workers, railroad employees, and a few others. Owners are not considered employees for purposes of this requirement, although they can be included in the coverage if they desire.

What are the risks of not having this insurance?

If an employee suffers an injury or illness as a result of their duties in your employ, you could be found liable for damages. These could include any required medical treatment, and you could be held responsible for punitive damages if the court sees fit. You may have to compensate the employee for loss of income if they’re unable to work, and you will certainly accumulate lawyer fees.

Can employees sue if you have workers’ comp?

Employees who suffer a workplace injury or illness while in your employ must agree not to seek additional redress if they accept medical treatment through workers’ compensation. They can sue but only if they decline the free care, so legal action is far less likely.

What affects premiums?

The three factors that most directly affect your insurance rates are the size of your company payroll, your workers' job classifications, and your company claims history. You’ll pay higher premiums the larger your payroll is, the more dangerous your employees' jobs are, and the more claims you've had in the past.

In North Carolina, private insurers are permitted to sell workers’ compensation insurance on the open market. To purchase a policy to protect your small business and its employees, contact Sun Valley Insurance, an independent insurance broker in Indian Trail, NC. They've been helping Union County businesses and individuals protect themselves from risk since 2010. They’re an independent insurance broker specializing in auto, life, business, and home insurance. Check out their website for directions and office hours or call (704) 282-1155 to request an insurance quote.