Managing Workers Compensation

By William J. Kirkwood, Executive Vice President, Risk Management at Summit Financial Group

Employers purchase workers compensation insurance in order to support employees who may become injured while on the job. Workers compensation insurance not only aims to protect employees from paying potential high costs associated with their injuries, but also protects the employer as it relieves the company of liability once a claim is filed. However, the way a company is covered differs by each state. In Connecticut, if an employee choses to leave the office for lunch and is in a car accident, the injury sustained is not covered under workers compensation. Alternatively, in Indiana, this type of injury would fall under workers compensation coverage. Each state has legislation stating what is or is not covered under workers compensation. In fact, the state of Texas is the only state in which business owners are not required to purchase workers compensation coverage. While investigating what type of workers compensation plan is best for your company, here are a few tips to ensure both employers and employees are on the same page:

· Create an effective safety plan promoting safety knowledge while emphasizing management’s continued commitment to the safety and well-being of its team members.

· Put together a safety committee to empower employees with the opportunity to host regular meetings, and take actions to improve safety awareness and exposure to risk.

· Include physical requirements for new employees including written physical requirements. Screen employees for physical ability to perform the requirements associated with the position in order to avoid claims by new employees.

· Properly educate employees by organizing detailed trainings to inform new employees of the procedures in place. Remind employees of ergonomic standards that can contribute to better health and offer an assessment of employees’ desks and chairs.

· Encourage employees to report all incidents promptly. This will assist management in reporting all accident incidences to authorities immediately. According to the National Council on Compensation Insurance, delayed claims can increase compensation costs up to 51 percent.

· Implement Employee Assistance Programs to reduce workers compensation claims and increase employee morale and overall team performance.

Although workers compensation insurance can be one of the most expensive forms of insurance for a company, it is often the most valuable as it protects employers and employees, not to mention it encourages the promotion of safety in the workplace. If a plan needs to be reformatted to properly meet the workers compensation requirements of your state and therefore better protect your employees, a Summit advisor is available to guide you through the process.