Workers Compensation Insurance
Workers Compensation Insurance
Illinois law requires employers to provide workers compensation insurance for almost everyone who is hired and whose employment is based in Illinois. Sole proprietors, business partners, corporate officers and members of limited liability companies may exempt themselves from workers comp insurance coverage.
Illinois has a no-fault worker’s compensation system to protect employees and employers in all types of commerce. Other states have their own workers compensation systems which is a mandated program to compensate employees who are injured in a workplace accident or rendered ill because of the job.
Since workers compensation insurance typically only covers injuries or illnesses when they occur as a result of duties performed on the job or while at work, the scope of the coverage of the policy is limited to duties performed by employees.
Failure to carry Workers Compensation insurance can be costly.
An Illinois employer that knowingly fails to obtain workers comp insurance can be fined up to $500 for every day of noncompliance. Corporate officers can be held personally liable if the company fails to pay the penalty. In addition to a fine, the Illinois Workers Compensation Commission may issue a work-stop order for an employer that has failed to provide workers compensation insurance. The employer must then stop all business operations until proof of insurance can be provided.
If you have one employee, even a part-time employee, you must obtain workers compensation insurance in Illinois.
Injuries that may be covered by workers comp insurance include lifting heavy equipment, slipping on a wet or oily surface, or sustaining injury, due to fires or explosions. Workers Compensation Insurance may cover:
- Medical bills for employees hurt or sickened at work.
- Ongoing care, including rehabilitation.
- Wages missed while recovering.
- Employee lawsuits over injuries.
- Funeral expenses, if an employee is killed on the job.
- Death benefits to support the deceased's family.
Workers Compensation does not cover:
- Third-party lawsuits.
- Lawsuits over professional errors.
- Wages for a replacement worker.
- Parental leave benefits.
- OSHA penalties.
How much a company pays for workers compensation insurance depends on several factors such as employee job classifications, the company’s payroll and the company’s workers comp claims history.
To learn more, contact one of our professsional insurance advisors today.