Worker's Compensation Coverage Unlike health insurance, which is for general medical care, worker's compensation is a required insurance program that employers must pay into to protect their workers from on-the-job injuries. This injury insurance gets paid from a government fund, typically at the state level, and employers pay into it via rates based on the number of employees they have. The rates fluctuate based on a number of factors determined by the government agency in charge of the fund. Businesses can either contract through a government agency for coverage if offered or through an insurance broker. Failure to pay into the system can subject the business and employer to both civil and criminal sanctions. As a subset of worker's compensation, disability coverage deals with chronic or long-term recovery associated with an occupational injury. The coverage pays for time off of work, loss of income, medical needs and equipment, and loss of life enjoyment. Because the costs associated with such coverage can rise exponentially with just one case, regular oversight and follow-up is required. In some instances, employee fraud is found and the employee faking the injury is then subject to criminal and civil penalties for "trying to cheat the system." Employees can also purchase their own long-term care or long-term disability insurance coverage independently if such a plan is offered through their employer. Because the names are similar, employee-bought disability coverage can be confused with that provided by worker's compensation programs. In the employee-bought version, the insurance charges a monthly rate from the employee's paycheck in return for long-term coverage of the employee and spouse if it is needed. This type of plan provides for nursing assistance and monitoring services for a disabled or bed-ridden patient. Depending on the type of plan bought, the employee can either see a reduction in the cost of such care via the plan or a payment of the costs outright. Such coverage is time-limited as insurers want the employee to either go back to work or get classified as permanently disabled (in which case the person can apply to Social Security for disability benefits instead). Insurance Site .org All Content Copyright 2011 InsuranceSite.org Return to Home Page Privacy Policy Conclusion Insurance can provide multiple benefits in a number of ways for consumers and represents an important part of one's financial portfolio. Without it, people can very easily find themselves in risk situations that could easily end in bankruptcy court and loss of most assets. To avoid this undesired ending, consumers should take out insurance policies on those areas and assets they depend on the most to protect themselves and their loved ones. After that, if desired and money allows, other items or issues can be insured as well. Remember, at the end of it all, insurance is just a risk management plan. If nothing goes wrong, you don't get any recourse on the money spent. It's a sunk cost. But if something does occur, having that insurance coverage may be the next best thing to being bailed out on someone else's dime. Introduction Business Vehicle / Auto Property Health Insurance Life Insurance Worker’s Compensation Auto, Home, Life, Health, Business - How Insurance Works