Property, Casualty and Liability Insurance - Worker''s Compensation
Workers' Compensation and Employers Liability
Worker's compensation benefits compensate workers who are injured in the course of their employment. Most workers compensation laws are required for all employers covered under the law. The full cost of providing workers compensation benefits is absorbed by the employer.
The five basis principles upon which worker's compensation laws are based include:
1) Employer must purchase & maintain workers compensation insurance
2) Benefits are paid periodically not in lump sum
3) Employee gives up the right to sue the employer in exchange for the benefits
4) Employees cannot be required to contribute to workers compensation premiums
5) The laws impose "Absolute Liability" on the employer for all injuries to the employee while working in his/her occupation. Negligence by the employee is even covered.
Benefits & Taxation
- Medical expenses without limitation
- No deductibles or coinsurance
- Disability income with very short waiting periods
- Payments between 60 to 70% of average weekly income
- Death benefits payable to family members
- Unlimited rehabilitation benefits
- Workers compensation benefits are received free of income taxation
Which of the following are correct statements concerning the workers compensation system?
I. Benefits received are tax-free
II. Employees must fund the workers compensation program thru union dues
III. Disability income payments typically have a 180-day waiting period
IV. If the employee was "goofing off" by playing a practical joke and was injured on the job, they would need to file a claim under their medical insurance
A. I only
B. I and II only
C. I, III, and IV
D. I, II, III, and IV
The only correct statement is that workers compensation benefits are received tax-free by the employee with a payment on average of 2/3 of their normal pay. Workers compensation is funded by the employer only, has waiting periods of short durations (typically less than 30 days), and covers negligent acts of employees while at work.
Employer's Liability Coverage
These policies also provide Employer's Liability coverage that protects the company in the event that an employee alleges that the employer's negligence or failure to provide a safe workplace was the cause of the employee's injury or illness. (Protects against unsafe working conditions) Introduction to Health Care Insurance
ProfessionalsLearn about the benefits that a business must offer to employees, such as family and medical leave, as well as various forms of insurance coverage.
RetirementThese tax-advantaged retirement savings plans have their pros and cons, and employers and employees must follow strict guidelines.
ProfessionalsAre financial workers making more or less since the 2007 boom?
Options & FuturesFind out how to determine whether a CEO is being overpaid.
Home & AutoChoosing employee benefits involves weighing the probability you will need them against taxes and cost.
EconomicsEducation and training benefit not only the worker, but also the employer and the country as a whole.
TaxesBy Denise ApplebyA qualified plan may be funded by both employer and employee contributions. Contributions are mandatory for some plans and discretionary for others, but the limits on employer ...
RetirementDiscover the major advantages and disadvantages offered by deferred compensation plans for retirement as compared to a 401(k) plan.
Personal FinanceYou need to think beyond salary to make the most talented people want to stay on for the long term.
Personal FinanceUnions don't have the membership numbers that they once did, but they are still a vital part of several different important industries.
Workers' compensation is a publicly-sponsored system that pays ...
Insurance that protects employees under state laws, and provides ...
An insurance policy that covers medical care, lost income and ...
A type of loss reinsurance that is purchased by insurers of workers' ...
A way corporations use stock options to reward employees. Stock ...
A United States labor law that offers protection to workers, ...
Learn how offering fringe benefits can be a strategic recruitment and retention tool for employers and drastically increase ... Read Answer >>
Learn how offering fringe benefits allows employers to entice new talent to join their teams, although part-time workers ... Read Answer >>
Learn a few strategies in hiring, compensation and management that employers can use for increasing employee retention and ... Read Answer >>
Read about the types of regulations that impact employee fringe benefits in the United States, including benefits mandated ... Read Answer >>
Learn how offering fringe benefits is a powerful business tool for employers to attract and retain quality employees while ... Read Answer >>
Restricted stock represents any equity that is conditionally given or sold to an insider as compensation or as part of an ... Read Answer >>