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IPS / Lighthouse Insurance Group Blog: workers compensation

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hard hatWorkers’ compensation insurance protects your employees from financial loss due to injuries occurring at work. You know the value of having this coverage. Yet, there can be some gray areas to consider when it comes to defining who has coverage. State laws differ in some areas, so it is important to verify information with your agent. These guidelines can give you a place to start, though.

Who is Your Employee?

An employee is a person who works for your business. It seems like a straightforward question, but there are some areas that can be confusing.

Generally speaking, your state’s laws determine who an employee is. Most of the time, they will include:

• Those who work for you daily

• Leased employees

• Part-time employees

• Unpaid volunteers

• Borrowed employees

• Any type of day labor

In some situations, subcontractors may fall in this area, too. This is less common.

If you have an employee with a unique situation, be sure to talk to your workers’ compensation insurance agent about this employee, including what he or she does and how they work for you.

There Are Some Exceptions

Some states have exceptions in place for covering employees for workers’ compensation. For example, most states will state that independent contractors – those that you do not file taxes for—have no coverage under this policy.

Some states also limit some categories of workers from eligibility. This may include seasonal employees or domestic employees, for example. In some areas, agricultural workers may have less protection. This is only possible when the state’s laws allow for it. Other states only require businesses with certain numbers of employees (say five or more) to buy coverage.

Why It Is Best to Cover Them

If you have someone working for you, but you are not sure if they qualify for workers’ compensation insurance, talk to your agent about it. Discuss what your needs and concerns are. If the employee could have coverage, and has a claim to file, doing so may be a good thing. By providing your employees with access to coverage, you ensure they get the care they need. This may help you avoid a lawsuit. It can also help you reduce risks associated with losing the employee to a company with more protections.

There are limits in every situation. And, the terms of your workers’ compensation policy can play a role in this, too. It’s important to speak to your business insurance agent about any concerns you have about proper coverage for your team.

Posted 9:00 PM


Workers' compensation provides financial protection to businesses. If an employee suffers an injury resulting from the work they do, this policy covers some or all of their losses. This minimizes the financial loss your business may suffer. Some states require businesses to maintain this insurance. If so, it is important to have proper protection. Here is where to start.

What Factors Apply to Your Requirements?

safety gear with sign behind saying be safe at work

States have different laws regarding workers' compensation insurance. In some states, the requirement is clear - all employers need to maintain a policy. In others, there are limitations. Your first step should be to determine the requirements in your state. Your business insurance company can provide very specific information here.

Keep in mind that even if not required, workers' comp can still be a valuable asset for you. It offers protection from financial loss that can amount to thousands of dollars.

What Some States Require

The rules to remain in compliance vary from one state to the next. If you fail to maintain coverage, you may face a fine. Here are a few things to think about:
  • Some states require workers' comp if the company has more than five, 10, or another set number of employees. Failure to maintain this insurance results in fines. For example, in New York, all companies with at least five employees must maintain coverage.
  • In some states, such as Pennsylvania, if you don't carry coverage, it can result in a felony charge. This includes if you fail to disclose the true number of employees you have.
  • In California, Illinois, Massachusetts, Michigan, and Pennsylvania, failure to carry proper workers' compensation insurance can result in criminal charges. This may mean fines and jail time.
  • Texas is one of the only states that does not require employers to maintain this coverage. However, it does still hold employers liable for employee injuries in most circumstances. Employers therefore should carry coverage.
As you can see, maintaining proper workers' compensation insurance is critical. It safeguards your company financially and ensures you meet compliance requirements.

How to Ensure You Don't Make a Mistake

If you are unsure if you need workers' comp, call your business insurance agent. Discuss the type of business you run. Talk about the number of employees you have.

Think about the risks. Can employees suffer injuries? Could someone get sick? Chances are, the can at any time. Proper insurance is not just about compliance.

It is also about keeping your company safe. It does not have to be hard to get this coverage. Most states offer competitive insurance policies. You can find affordable policies that fit your needs. Then, you do not have to worry about an employee injury on the job.

If you need workers' compensation insurance coverage, contact Insurance Planning Service today at 734-421-9900.

Also Read: Reducing Worker Falls on Icy Outside Surfaces


We don’t think of small amounts of water as particularly threatening. However, in the right situations, even puddles might prove dangerous. What if you slip in one at work and fall? Qualifying injuries might qualify you for workers’ compensation coverage. How do water risks fall into this coverage? What canimage of a safety first sign you do to prevent water-borne threats in the business?

Why Water Poses a Workers’ Compensation Risk

Workers’ comp helps employees who have suffered injuries or illnesses during their duties. They can get money to aid them in their recovery and supplement lost income.

If an injury comes about because of standing water or water damage, then the affected party often has recourse. Workers' comp claims from water risks might include slip-and-falls and mold exposure.

Why do Slip and Fall Risks Exist?

Anywhere water puddles, there’s a fall risk. Even a small puddle could cause someone to slip. The resulting injuries might range from a bruised shin to a severe head injury. Standing water and fall risks might originate from:

  • Leaking pipes and ceiling leaks
  • Spills from coffee pots, sinks or water fountains
  • Wet floors following cleaning
  • Puddles in entryways or on sidewalks on rainy days

In most of these cases, if a fall occurs, you can qualify for a workers’ compensation claim. For example, if you slip while in the bathroom, you’ll often have protection. Nevertheless, not all falls will equal a claim. If you fall while out of the office to eat lunch, you might not be able to file.

Mold Risks and Coverage?

Anytime you have standing water, you have a mold risk. If mold develops, it might cause breathing problems and other extensive injuries.

Let's look at an example. Mold might grow undiscovered behind a business’s walls. Over the years, you might become ill because of this exposure. As a result, you might be able to file a successful workers’ compensation claim.

Nevertheless, mold is a tricky subject. It’s sometimes hard to pinpoint if your particular illness came from the mold in your workplace. Even so, if you can prove this fact, then your employer’s workers’ comp policy could cover you.

Employers have an obligation to provide a safe workplace and prevent mold growth. If you are in charge of this, consider a few different precautions. These might include:

  • Keeping humidity and temperature low and dry
  • Having regular mold tests as needed.
  • Looking out for any leaks, including hidden leaks. Have these fixed immediately.
  • Cleaning up any standing water immediately. Use cleaning supplies that will combat mold risks.

If you have questions about slip-and-fall or mold coverage, contact your workers’ comp insurer. Ask what your policy will cover, and how they cover it. In the meantime, do what you can to prevent workplace accidents.

Also Read: Expanding Your Employee Benefits Package


Your employees do a lot for your business. You want to show them that you have their best interests at heart. Offering benefits is one way to do so. image of employees gathered

Not only do you recognize the importance of protecting employees, so does the law. Some benefits are not options, but requirements. Businesses often have to provide certain perks to their employees. These particular benefits often act as valuable personal protection for your workforce.

Required Employee Benefits

Employee benefits usually involve various forms of insurance. Therefore, multiple laws cover whether certain businesses must offer certain benefits. As a business owner, always make sure you provide the benefits required of you. These might include

  • Health Insurance: Many employers have to offer some or all employees health packages. The employer usually shares the cost of the policy with the employee. These packages usually must meet standards set forth in health insurance law. Whether the employee takes this coverage is up to them. However, the employer usually must at least offer it.
  • Workers’ Compensation: If an employee gets hurt on the job, they might have to miss work to recover. This means they might not be able to receive income because they cannot work. Most businesses have to provide workers’ comp as a result. It serves as a way to help an employee receive income while recovering from an injury.
  • Overtime Pay: When certain employees work past their required time, they qualify for more pay.
  • Minimum Wage: Federal and state law require some or all employees to receive pay at a minimum level. The minimum wage is one way of making sure that employees can pay their own bills.

A variety of laws might govern how businesses must compensate their employees. Check your local statutes for more information on the benefits you must offer.

Optional, Additional Benefits

Good perks often provide incentives for your employees to stay with your company. So, most businesses provide a wide range of benefits. Beyond required benefits, additional perks you might offer include

  • Dental insurance for adults (many health insurance plans come with pediatric dental insurance)
  • Paid maternity or paternity leave
  • Paid holidays
  • Club memberships such as gyms or health spas
  • Life insurance and retirement accounts (some states might require this coverage)

And everything from pay raises to severance pay.

When it comes time to setting up your company's benefits plan, talk to your commercial insurance agent at 734-421-9900. They can help you enroll in benefits in compliance with the law. You can then work on offering extra benefits that provide workers with more comfort.

Also Read: Reducing Worker Falls on Icy Outside Surfaces and What to Consider When Launching a New Business


For just about every threat your business encounters, there's an insurance policy that will cover it. But what's necessary and what isn't? In terms of business insurance, it is important to cover all potential liabilities. Your business must adhere to all employer insurance requirements that the state requires, but that doesn't imply policies that are not required are any less significant; nor does the state minimum necessary guarantee that your business is fully covered. Read these quick tips and hints for a better understanding of business insurance requirements.

What's Crucial?

Workers' Compensation Insurance covers the medical costs, rehabilitation costs, and lost pay of any employee hurt on the job. Workers' compensation insurance also handles employer liability in the event of legal action. If perhaps an employee or even an employee's family sues your business as a result of a physical injury to one of your employees, this type of insurance will cover your business and any responsibility you have.

Workers Compensation Insurance is required by law in all 50 states, U.S. territories, and the District of Columbia. However, each state sets their minimum amount of coverage required for each type of business. In Michigan specifically, the Workers' Disability Compensation Act provides workers compensation for injured employees and covers their employers. The Michigan Workers Compensation Agency can answer all questions regarding workers compensation requirements for a business in Michigan. This state minimum is purely a starting point for your insurance. Make sure you talk with an independent insurance agent about your business assets, risks, and needs to insure that your business is fully covered. Your business may require more than the state minimum in order to be fully protected.

One way to help insure safety in your workplace is to provide a safety training workshop for employees and create employee handbooks on workplace safety. A workshop can help raise awareness to the importance of safety around dangerous equipment, give tips for safe work procedures, and show the importance of risk management. An employee handbook is a way to make sure these guidelines are followed throughout the year.

Other types of liability insurance may also be required, or strongly recommended, for your business. Talk with an independent insurance agent about your business to help determine the risks you need to be protected against. Don't let a fire, theft or storm come before you are protected.

Once your business has complied with all the insurance requirements for your state, you may opt for additional coverage that covers your business in other ways. Extra insurance coverage can fill in any gaps in your policy and protect your business against a disaster that could otherwise prove detrimental in the event of a disaster. Give IPS Insurance Agency a call at 800-220-5582 to discuss your business needs and set up Michigan business insurance to protect your business against risks in the workplace.


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Lighthouse Group Main Office in Grand Rapids, MI
Mailing Address | P.O. Box 530009, Livonia, MI 48153

Phone: 734.421.9900 | Toll Free: 800.220.5582 | Fax: 734.421.9911

Also serving these Detroit area communities in Michigan: Livonia, Farmington Hills, Ann Arbor, Southfield, Plymouth, Canton, Westland, Northville, Novi, Dearborn, South Lyon & Walled Lake