Covering Onsite Injuries: Workers’ Compensation vs. General Liability Insurance
No matter how many precautions you take, work-related accidents are bound to happen. Your business must be prepared for these worst-case scenarios and know what insurance types cover which type of expenses. For any business, general liability insurance and workers’ compensation will go far in helping your company in the case of an onsite injury.
When an injury involves someone employed at your company, workers’ compensation insurance can help cover injury-related expenses. This type of insurance often offers employees medical care, rehabilitation, cash benefits, and supplemental benefits after an injury.
Most states in the U.S. require businesses to have workers’ compensation insurance. It protects your workers’ financial well-being, and it can give the employer peace of mind by reducing their liability in the case of a work-related injury.
Unlike other insurances, workers’ compensation also covers injuries that occur offsite while the employee is performing work-related duties. Most basically, it helps your employees pay for medical bills related to work injuries. Workers’ compensation can also:
- Provide disability benefits in the case of a partial or permanent injury that occurred while on the job.
- Partially replace lost wages while recovering from a workplace injury.
- Give death benefits to workers’ families to help pay for funeral costs in the case of a work-related death.
While it’s true that workers’ compensation generally protects businesses from getting sued by an employee after a workplace injury, it doesn’t prevent your company from being sued in all scenarios. Workers may appeal if they believe their workers’ compensation was not adequate to cover their income or pay for their sustained injuries. In this case, businesses will need liability insurance to fund a potential lawsuit.
A Customer, Client, or Vendor
General liability insurance is one of the most common ways employers can protect themselves against a lawsuit if an injury occurs onsite. It protects employers against claims involving:
- Damage to a property owned by another individual
- Reputational harm resulting from slander, libel, wrongful eviction, and more.
- Bodily harm caused to someone visiting your business.
- Copyright infringement and other business and advertising injuries.
It’s estimated that nearly half of all small business owners alone will see a property or general liability claim within the next ten years. As such, it’s more important than ever to make sure your business has liability insurance.
General liability only covers physical or business-related injuries caused to another party. It does not apply to injuries involving your business’s property or employees. It also won’t help your company if faced with a lawsuit caused by mistakes related to the services you provide. Your business will also need professional liability insurance to cover these legal fees.
An Independent Contractor
If an independent contractor is injured on the job, it’s most likely that your business will use liability insurance, not workers’ compensation, to help pay for injury-related expenses. An independent contractor is considered a non-employee contract worker, not an employee who works solely for your business.
Your business’s liability insurance for an independent contractor will vary by your size, location, experience, policies, and risk exposure. Given the number of variables at play, it’s recommended that your business consult a local general liability insurance provider to determine what’s best for you.
While laws will vary depending on the state your business operates in, most states exempt business owners from having to purchase workers’ compensation for themselves. However, owners may choose to attain coverage for themselves.
Several options are available for business owners who may be interested in workers’ compensation. Just as the type of coverage for workers varies by the size and risk factors associated with your company, the same is true for owners. A local insurance provider could help you determine whether your state requires you as the owner to have workers’ compensation and your options if you chose to purchase it for yourself.
Workplace Injuries and Your Business
It’s the responsibility of any business owner to protect those who are crucial to your operations from harm. Workers’ compensation and general liability insurance are essential ways to accomplish that goal. While regulations may vary by state, workers’ compensation generally protects your employees in case of a work-related injury and limits your workers’ ability to sue you or your business.
General liability insurance protects your business if someone or something owned by another individual not working for your company is harmed or injured. Because both types of insurance protect your business from different sorts of liability, both are crucial to shielding your business and workers from harm in the case of a work-related injury.