When it comes to Business Insurance policies, Workers Compensation should be at the top of your list as a business owner or risk manager. Although it is not required in Texas, it is highly recommended.  That being said, YES, it is necessary. Lets take a quick look at Part I and Part II of the Workers compensation policy and see why it's necessary. 

• Part I of Workers Compensation addresses employee work related injuries or occupational disease. This is essentially the heart of the Workers Compensation policy where the insurer agrees to pay for injuries sustained during the course of employment. Part one of the policy has eight clauses. One thing to note: Health insurance and General Liability do not cover work related injuries. 

 

• Part II is Employers Liability Insurance (not to be confused with Employment Practice Liability (EPL)). This part addresses the employers protection. If the employee believes the employer is negligent in the work related injury, and decides to sue, this part of the policy will respond. It will cover attorney fees, court fees and judgments or settlements. There are nine clauses to part two of the policy. 

As you can see, there's a reason most states require employers to have Workers Compensation coverage because it is extremely necessary. To be honest, in my 12 years as an insurance agent, I've seen more claims from Workers Compensation policies than any other policy. If you have questions about Workers Compensation coverage or any other Business Insurance policy, please feel free to contact me. If you would like a quote, please fill out the application below. To read another post about Workers Compensation, see this previous post Is Workers Comp Insurance Required? 

Jason Matison
Commerical Insurance Agent
Austin, Texas

Workers Compensation Insurance is one of those coverages that some businesses overlook when it comes to Business Insurance. It is often asked, is it required? The answer is, no, the State of Texas does not require you to have it. However, some companies you do business with, or businesses that you want to do business with, may require it. So there you go, pretty straight forward, right? Well, it might not be required, but I highly recommend Workers Compensation.

I think a lot of businesses feel they don't need it, because they use subcontractors. Taking the stance that they are not technically employees, so they don't need it. As a business owner, you have to ask yourself, are they acting as employees? Do they show up representing your company? Are they doing work and collecting money on your behalf?  If the answer is yes, the courts have pretty much already determined that they are your employees. Just a few things to ponder when trying to figure out who needs Workers Compensation coverage.

You still might be thinking it's not necessary and your employees are not at risk. Here's a list of 5 leading causes of work place injury taken from the U.S. Bureau of Labor Statistics and National Academy of Social Insurance:

1) Overexertion involving outside source: 24.4%
2) Falls on same level: 16.4%
3) Falls to lower level: 8.7%
4) Struck by object or equipment: 8.6%
5) Other exertions or bodily reactions: 6.7%

In addition to your employees being at risk, your business could be at risk. Workers Compensation provides protection to the employer. You can have piece of mind knowing that if an employee gets injured, you don't have to worry about them suing you and your business. 

So, again, Texas does not require you to have Workers Compensation (yet), but it's not a bad idea to get it anyway. A lot of business owners are under the assumption that it is expensive. If you haven't gotten a quote, or it's been a while since your last quote, let me know if we can get you a quote. I've helped many businesses in Austin get Workers Compensation and would love the opportunity to help you. Feel free to call or email me.

Jason Matison
Business Insurance 
Austin, TX