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Running a small business comes with its own set of challenges and responsibilities. One crucial aspect that every small business owner should prioritize is workers’ compensation insurance.
It can be difficult for small businesses to want to take on what may feel like unnecessary costs like workers’ comp insurance that’s only used in the case of emergencies. Still, it provides essential protection for both employers and employees in the event of workplace injuries or illnesses.
Although the majority of small businesses with employees in every U.S. state except Texas are legally required to purchase workers’ comp coverage, it’s beneficial to understand why you’d need workers’ comp (even if it wasn’t legally required) to justify the cost and put your mind at ease.
Keep reading to learn the main reasons small business owners benefit from taking on workers’ comp coverage.
#1: Provides peace of mind to clients
Especially for businesses that have employees going to work on their client’s properties, clients appreciate working with companies that have workers comp so they do not have to be liable for any onsite injuries.
For example, although independent contractors and self-employed business owners are often not legally required to have workers’ comp, many end up purchasing it to fulfill the terms of contracts with clients.
#2: Protects your income
Health insurance does not usually cover work-related injuries or illnesses. If you have workers’ comp as a small business or independent contractor, your medical expenses will be paid in the event that you’re injured while working, which can potentially save you a large sum of money.
If your employee is significantly injured at work and has to take time off, workers’ comp can also partially replace lost wages during recovery.
By having workers’ comp insurance, you can transfer the financial risk to your insurance provider and ensure that your financial resources are protected.
#3: Accidents happen
Even if you have the best safety policies and procedures in place or your employees mainly work at their desks all day, your employees are people who can make mistakes, and accidents happen.
Workplace injuries are a broad term—your employee could claim they hurt their back while bending over to pick up a pen that they dropped or accidentally harm their fingers while using a paper cutter and submit a workers’ comp claim.
No matter how small or large the injury is, workers’ comp insurance significantly protects your business from the costs of medical expenses and lost wages as well as from being sued in severe cases.
Workers’ comp is a type of insurance like general liability insurance where the benefits far outweigh the costs for small business owners in various industries.
Related resource:
Five reasons to partner with a PEO for workers’ compensation
Seeking workers’ comp insurance (and more!) for your business?
At PER, we provide comprehensive workers’ compensation insurance to all of our clients in addition to our payroll management services—but that’s not all!
By partnering with PER, a Certified Professional Employer Organization (CPEO), you’ll be backed by our team as your coach and safety net for payroll management, benefits administration, workers’ compensation, and employee-related issues.
As your co-employer, we’ll support you and your team by:
Ready to tap into our extensive capabilities?
Contact us today to get started!
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