The Dangers of Not Carrying Workers Comp Insurance
- Posted on: Feb 22 2022
When a company is operated within a state, there will be quite a few expenses involved. Regardless of the size or business of the company, the owners of these businesses love when they are able to find short cuts in order to save themselves money. Many companies will also try to save costs by eliminating costs that seem unnecessary, such as workers comp. However, the fact of the matter is that there are more risks involved for the company and if an injury occurs, then the financial liability could be in the hundreds of thousands.
States Governing Workers Comp
While each state has their own requirement when it comes to workers comp, all companies are required to have a certain type of insurance. The only exception is Texas, which only makes the requirement voluntary. When it comes to the rules and coverage of each state, that is determined by the state itself. For example, Georgia requires the workers comp insurance be determined by the number of staff members they have. While another state may have the company carry insurance based on company type. It is important that a business owner fully understands their state laws regarding workers comp as well as the coverages they must provide.
Fines Instilled For Non-Coverage of Workers Comp
Similar to what we saw with regulations regarding workers comp and their state requirements, there are also laws covering the fines instilled for non-coverage of workers comp. Besides fines, states may also pursue felony charges against a company if they willingly forgo workers comp coverage, which may put the company owner behind bars. A few of the states that could add jail time are Michigan, California, Massachusetts, Illinois, and Pennsylvania.
Staying Away From Any Type of Risks
Having a huge expense such as workers comp may not be what many companies will be willing to pay for. In fact, many companies experience an operating cost of 2% just for workers comp insurance. With the rise of costs increasing, the amount of companies deciding to forgo this coverage will also rise. It is crucial that the insurance not be dropped by the company.
The purpose of workers comp is to provide coverage to all employees of a company who sustain injuries while on the job and covering the medical bills sustained by the injury. It also includes covering legal fees and wages lost while recovering. It is believed by many that having the costs paid out of pocket may save money. However, it is also believed that the premiums a company pays will be cheaper in the long run.
With the high risks involving workers comp, many companies decide to get away from offering it in order to save money. If you currently work at a company that does not provide workers comp and you have been injured on the job, then you need to get a hold of us today to get your injury case started.