Insurance Continuing Education – Work Related Illness and Injury

Employees and employers frequently ask why the insurer cannot combine employment benefits and Workers Compensation, thereby providing 24-hour coverage for accidents and illnesses.

For regulatory purposes, this would be like mixing apples and oranges  – health insurance benefits provided as employee benefits are underwritten by companies or organizations under the life and health insurance regulations of the state Department of Insurance.  Workers Compensation is normally under the jurisdiction of the Property and Casualty regulations.  (Workers Compensation can be provided through a state-owned monopoly also).

Forgetting for the moment that for Workers Compensation (WC) purposes all employees are covered immediately after hire, whereas under an Employee Benefit (EB) program, there is normally a waiting period before coverage can be offered, and normally it is not available to part-time employees, there are some other determining differences.

State laws make WC mandatory for all employees of a firm of a certain size, or involved in a certain occupation.  EB is optional and is more common with large employees, i.e. there is no known regulations (at this time) that require ALL employers to provide employee benefits.

The primary difference is that WC pays for all medically necessary care, income replacement benefits, and vocational rehabilitation.  EB pays for medical benefits which may be limited in scope (may not pay for all medically necessary care) and they normally do not pay for disability.  If the employer does have a disability plan as part of employee benefits, it has a waiting period and usually coordinate with WC.

For the employee, the principal difference is that WC is provided at no cost to the employee, whereby EB may require the employee to pay part of the premium.  Also, the health insurance plans normally have deductible and coinsurance provisions.

At this particular time, there is a major healthcare benefit provider active only in one state, that has just started offering WC through an affiliated company.  The life and health agents may sell WC, but only under very strict conditions and under the license of a Property and Casualty general agent.  This experiment should prove interesting and it can be expected that other large health benefit providers may offer this coverage.

One note of caution:  Some indemnity insurers offer individual Major Medical plans which cover job-related accidents or illnesses if the insured is not covered by Workers Compensation insurance.  However, these plans only cover the medical benefits, and are subject to deductible, copayment provisions, etc.  Specifically, they do NOT cover disability payments.

Insurance Continuing Education

Continuing Education Insurance

Continuing Insurance Education