Industrial insurance

Industrial insurance employee benefits help injured workers. They pay expenses that are directly or indirectly caused by the occupational accident, including the following:

• Medical care: This pays for the cost of ambulance rides, healthcare provider visits, emergency room trips, hospital stays, surgical procedures, medications, physical rehabilitation, and more.
• Lost wages: If an employee has to take time off work to heal or recover from a workplace incident, this replaces some of their lost income. There are usually caps to the amount and it may vary depending on the nature and extent of the injury or disability.
  
  The four classifications are:
  • Temporary total disability (TTD)
  • Temporary partial disability (TPD)
  • Permanent total disability (PTD)
  • Permanent partial disability (PPD)
• Vocational rehabilitation: If an employee is disabled so severely that they can’t perform the role they held while injured, then they may qualify for support such as job training to acquire skills for a new career. This is also known by other names, such as “supplemental job displacement” in California.
• Death benefits: If the accident is fatal, this reimburses for funeral and burial expenses. It can also provide financial support to survivors in the form of cash payments.

This coverage is generally referred to in your industrial insurance policy as “part A,” “part one” or “coverage A.” There are usually no limits or exclusions to medical benefits. If your business insurance adjuster approves a claim, the insurance company will typically pay all necessary expenses in full. The amounts paid for lost wages are usually set by state laws.

In most states, employees who accept industrial insurance benefits give up their right to sue their employer for that incident. So, an injured worker cannot collect lost wages and healthcare payments and then turn around and file a lawsuit against you.

However, there are instances when your business can be sued for a workplace injury. That’s when employer’s liability coverage is relevant. The four most common claims are:

• Third-party-over action: An employee sues a third party, such as a manufacturer, over an injury they sustained on the job, and that manufacturer in turn sues you as a contributing factor.
• Dual capacity: An employee is injured and makes the claim that you are liable, not only as the employer, but also in another role, such as a product manufacturer, property owner, or service provider.
• Loss of consortium: The spouse of the disabled employee seeks punitive damages for a change in the relationship suffered because of the accident.
• Consequential bodily injury: A family member sues you for health problems they sustain as a result of your employee’s workplace injury.

In any of these cases, your policy would pay for:

• Attorney’s fees
• Court costs
• Settlements or judgments

Employer’s liability coverage is generally referred to as “part B,” “part two,” or “coverage B” in your industrial insurance policy. Unlike employee benefits, there are limits to the employer’s liability portion.

The claims process begins when an accident occurs at work and an employee is injured. Below are some scenarios that would involve industrial insurance:

• An employee of your janitorial business slips and falls in a client’s office after a co-worker mopped the floor. Industrial insurance would pay for their medical expenses and any lost wages.
• A hairstylist at your beauty salon or barber shop develops carpal tunnel syndrome, and a doctor establishes that the job’s repetitive motions caused the condition. Industrial insurance would pay for physical therapy or surgery and other healthcare costs. If they can’t continue cutting hair, they could also be reimbursed for alternative job training.
• While on a job, a member of your roofing crew falls and dies from his injuries. Industrial insurance would pay for the funeral and death benefits to survivors.
• A worker at your trucking company gets into an accident while driving and is paralyzed. Their spouse then sues you for the back injuries they sustained from lifting and transferring the injured worker as their caretaker. Industrial insurance would pay for legal costs related to the lawsuit. If you have MedPay or personal injury protection (PIP) on your commercial auto insurance policy, that could help pay for medical expenses.
  
  Otherwise, industrial insurance would step in to cover that and lost wages. If the accident occurred while performing a job duty besides driving—like loading cargo—that would be an eligible claim under industrial insurance, whereas it would be denied in the auto insurance policy.
• An employee of your lawn care business is injured by a defective piece of machinery. The employee sues the manufacturer of the product, and the manufacturer then sues you claiming you did not properly maintain it. Industrial insurance would pay for medical expenses and any lost wages, as well as for legal costs related to the lawsuit.
• You are a photographer. You’re a sole proprietor and have no employees. While taking pictures for a wedding, you fall and twist your ankle. Your industrial insurance would cover your medical expenses.

Note in the examples above, the location does not matter. If your employee is injured at your business’s office, store, warehouse, client job site, or even enroute, they would be eligible for industrial insurance benefits as long as they were performing a work duty.