Workers' Comp Insurance: How Much Do You Need?

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Workers' compensation insurance provides benefits and protection for employees who are injured or become ill on the job. The program ensures that employees receive benefits and medical care and, in most cases, protects the employer from legal action in the event of a job-related injury or illness. Workers' comp is similar to other types of insurance in that a new zealand phone numbers company will pay into a workers' compensation fund, from which benefits are paid to employees.

"When employees are injured on the job, workers' compensation provides financial coverage for their medical bills, lost wages and other expenses," said Jeff Somers, president of Insureon. "In addition to protecting employees, workers' compensation limits employers' exposure to lawsuits after work-related injuries."



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How much workers' compensation you need depends on several factors, including state laws and your industry. Reputable insurance agencies should be able to help you determine how much you need, but you should still do your homework to make sure everything is accounted for.

How much does workers' compensation insurance cost?
Workers' compensation insurance varies widely by industry and job type. According to Insureon, workers' comp costs in the U.S. range from 75 cents (in Texas) to $2.74 (in Alaska) per $100 in employee wages.

If you are shopping for a workers' comp insurance broker, you should compare prices, coverage and reputation. You'll want an agent who answers your calls quickly and understands your state's requirements as well as the specific hazards of your industry.

You should also know your experience modification rate (EMR), which Quinten Lovejoy, risk advisor at the Crane Agency, said is calculated and applied by the National Council on Compensation Insurance and is critical to determining your workers' comp cost.

"The NCCI is the authority that looks at a company's claims history and makes a projection of its risks based on the business itself and national trends of that industry," Lovejoy said.

Did you know? The NCCI does not govern all states. Some states have their own bureaus that serve the same functions as the NCCI.

John Espenschied, agency principal and owner at Insurance Brokers Group, recommends shopping around for your workers' compensation insurance.

"Each insurance carrier will have different risk appetites for business," he said. "Some companies will consider high-risk companies like roofers, while other companies will never offer workers' compensation for a roofing business. This means the rates can fluctuate between one carrier and another."