insurance By Chase Rimmer / March 20, 2019 Who needs worker’s compensation for a small business? Well, pretty much every small business. Now, if you are a sole proprietor then worker’s compensation insurance is optional. You don’t have any employees that could get hurt and need coverage, so you don’t need worker’s compensation insurance. But, if you have any employees, even a single employee besides yourself, then you are required to have worker’s compensation insurance. If you operate a sole proprietorship you don’t need to have worker’s compensation insurance, but you may still want to consider getting a policy because you still do have one employee that may need coverage, that employee being you. What Is the Purpose of Worker’s Compensation Insurance? Worker’s compensation insurance exists to protect both the employer and the employee. Worker’s compensation protects business owners by providing medical coverage to employees in the event of an accident that results in injury. This is especially important for small business owners since significant medical bills can prove to be a financial disaster for a small business. While you never want one of your employees to be injured, knowing that there is insurance in place to protect your business is important. It allows your business to survive in the event that you have an employee that has an accident and requires significant medical treatment. While your worker’s compensation insurance rates will likely go up if you file a claim, this is a small price to pay when you consider the alternative of having to pay for medical bills out of pocket. Worker’s compensation also benefits employees by guaranteeing them access to medical care in the event that they have an on the job injury. Worker’s compensation insurance also guarantees employee access to long term medical care if they suffered a work injury that requires them to receive care for an extended period of time. It also provides them with a percentage of earnings that they would normally make when working to help cover their living expenses. Finally, in the event of a major injury, worker’s compensation insurance companies will often offer a final settlement in the form of a lump sum payment. This provides the injured employee with financial stability, while also protecting the insurance company from further expenses in the future. How Do You Get Insurance for Your Business? If you run a small business you need worker’s compensation insurance. So, how do you get the coverage you need? All you need to do is contact a reputable worker’s compensation insurance company and arrange for coverage. Make sure that you choose a company that is well known since you will be relying on this company to protect your business in the event of any type of on the job accident. You should also take the time to shop around and compare rates to ensure that you are getting the best deal on your coverage. You don’t want to choose a worker’s compensation company based solely on what their rates are, but you also don’t want to pay more for coverage than you need to. What Could Happen If You’re Uninsured? If you are wondering what the consequences might be of not carrying worker’s compensation insurance, well, they are quite severe. So, if you are thinking of not getting coverage for any reason, this would be a major mistake. Maybe you want to try to save some cash by not having to pay your policy premiums. Maybe you only have a few employees that you trust to not get injured. Maybe you think it’ll be cheaper to just pay for any medical bills you run into rather than trying to pay premiums every month. No matter what reasons you may have for wanting to avoid getting worker’s compensation insurance, they are not good reasons. Setting aside the fact that failing to have worker’s compensation insurance could subject you to civil and criminal penalties, it can also ruin your life. How could a lack of insurance end up running your life? Well, let’s say that you have an employee that suffers a serious injury. The type of injury that requires extensive medical care, rehabilitation, and possible permanent disability on their part. If you don’t have worker’s compensation insurance to cover their lost wages, medical bills etc., then you are going to be looking at a major lawsuit. This can not only destroy your business, but it could also impact your personal life. You could see assets, such as your home, put in jeopardy due to your lack of insurance. All that it takes is a single accident when you don’t have worker’s compensation insurance, and everything you have worked your entire life for is now gone. While the penalties you could suffer from not having worker’s compensation insurance can be quite severe, by failing to get adequate coverage you are also forcing your employees to take risks that they shouldn’t have to take. What happens if one of your employees gets hurt and you don’t have insurance? Who is going to pay their medical bills and cover their lost wages? Eventually, it will be you, but in the meantime, your employee is going to suffer undue hardship as a result of your failings. As a small business owner, you need to maintain a solid relationship with your small group of employees, and part of doing that is ensuring that they are given all of the protections that they deserve. It’s Part of The Cost of Doing Business Worker’s compensation is a necessity for all businesses, big or small. If you run a small business then you owe it to yourself and to your employees to obtain a worker’s compensation policy that protects all of you. In the end, the low cost of a monthly insurance premium can mean the difference between your business surviving an employee accident or failing as a result of it. Don’t make the mistake of thinking you can get by without insurance, make the smart and responsible decision and get the coverage you need today.