Work Comp Coverage

Why Going Without It Can Be Costly

by Shelley Robinson

Not having workers compensation insurance, is a lot like having workplace injuries—nobody wins. It protects both employers and employees. One workplace injury can change the future for the employee and the business. Need proof? See the impact an unsafe workplace and no work comp insurance had for one business.

During the course of an investigation conducted by the Missouri Department of Labor and Industrial Relations Fraud and Noncompliance Unit it was determined that the employer let their work comp coverage lapse and never reinstated the policy. During the employer’s time without coverage, two of their employees were injured on the job.

The Incident
The two employees were injured while erecting grain bins. The crane operator was lowering the stairwells down into the grain bin and failed to have any spotters on the ground with a guide wire. The cable broke from the crane, dropping a section of the stairwell on two employees. One employee fell approximately 30 feet to the ground and the other employee fell approximately 20 feet to the ground. Both employees had to be air-lifted and suffered permanent injuries. The life altering injuries hit especially close to home for the employer as one of the injured employees was also their son. Medical costs for one of the injured employees exceed $750,000 and more than $500,000 for the other.

Dollars And Cents
When a business doesn’t have work comp coverage, who pays the bills? In Missouri, the Second Injury Fund covers the work comp related expenses incurred by the injured employee. In most cases, the employer is responsible for the injured employee’s medical expenses. Often times, the employer is sued by the injured employee and/or the Attorney General to recover the workers compensation, legal fees and damages costs.

Coverage Requirements
Missouri law specifically states who must carry work comp insurance:
• Most employers with five or more employees. This requirement includes part-time employees.
• Construction industry employers with one employee.  This requirement includes part-time employees.
• LLC members and corporate officers. They are considered employees in Missouri, though LLC members may elect to formally opt-out of coverage.
• General contractors. They are liable for any injuries to uninsured subcontractors or their uninsured employees and can require that subcontractors carry work comp.

Sole proprietors and partners are excluded under the workers compensation law unless they choose to be included.

The bottom line is that work comp coverage is required for a reason. Protect your employees and your business by putting safety measures in place and having the required work comp coverage. Check out worksafecenter.com and the Missouri Department of Labor and Industrial Relations for more information on workplace safety and work comp insurance. 
 
Shelley Robinson (srobins1@mem-ins.com or 573.449.4124) is a Marketing Communications Specialist at Missouri Employers Mutual, Missouri’s No. 1 provider of workers compensation insurance. MEM can help you eliminate injuries and reduce your work comp costs. Visit www.worksafecenter.com for your workplace safety needs.