Term
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Definition
| Employers are required by law to provide Worker's Compensation benefits to their employees with insurance, or demonstrate the ability to provide required benefits. |
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Term
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Definition
| Employers have the choice to accept or reject state Workers' Compensation laws. If an employer chooses to reject the Workers' Compensation laws and an employee is injured, the employee may then bring a suit against the employer and the employer is denied the use of common-law defenses, such as assumption of risk, contributory negligence, and negligence of a fellow employee. |
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Term
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Definition
| Workers' Compensation insurance is only available through a state fund. |
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Term
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Definition
| Workers' Compensation insurance is available through private insurers (most states). |
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Term
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Definition
The process by which the employer assumes absolute liability for injuries to the employee. Under Workers' Compensation, if the employee is injured, the employee may not:
a) collect benefits from the employer or the employer's insurance company and then sue the employer for negligence or liability, or b) refuse to accept compensation benefits in order to sue the employer for a larger award. |
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Term
Disability Income Benefits:
Temporary Total |
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Definition
| An injury, from which an employee is expected to recover and return to work, but is unable to do any work while recovering. |
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Term
Disability Income Benefits:
Permanent Total |
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Definition
| An injury that prevents an employee from being able to do any work for the rest of his/her life. |
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Term
Disability Income Benefits:
Temporary Partial |
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Definition
| An injury with which an employee is able to do some work, but is unable to earn his/her usual wage until full recovery. |
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Term
Disability Income Benefits:
Permanent Partial |
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Definition
| An injury with which an employee is able to do some work, but will never fully recover. |
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Term
Disability Income Benefits:
Scheduled Injuries |
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Definition
| A schedule of benefits that applies for specific permanent partial injuries, such as a specific amount for the loss of an eye, or a specific amount for the loss of a hand. |
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Term
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Definition
| Physical therapy and vocational training are utilized with the objective of returning the injured employee back to work as soon as possible. |
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Term
Death and Survivor Benefits
(Funeral Expense Benefit) |
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Definition
| A statutory maximum amount, varying from state to state, is provided as a burial allowance. Income benefits are a percentage of the deceased worker's wages and are also provided to the surviving spouse (and usually end at remarriage); and/or children (until age 18, or longer if a full-time student). |
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Term
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Definition
| Pays compensation on behalf of an employer to an employee who has already suffered a prior disabling injury, and now sustains a subsequent injury, and the combination of the 2 injuries creates a greater disability than the second injury would have created by itself. |
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Term
| The Federal Employers Liability Act |
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Definition
| Applies to interstate railroad workers. |
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Term
| The US Longshoremen and Harbor Workers' Compensation Act |
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Definition
| Applies to workers who load, unload, build, or repair ships (but not the crew of the ship). |
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Term
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Definition
| Applies to the crews of ocean vessels. |
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Term
| The Federal Employees Compensation Act |
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Definition
| Applies to all US civilian employees. |
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Term
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Definition
| Workers' Compensation Insurance |
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Term
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Definition
| Employers Liability Insurance (Stop-Gap Coverage) |
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Term
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Definition
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Term
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Definition
| The Insured's Duties if Injury Occurs |
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Term
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Definition
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Term
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Definition
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Term
| Voluntary Compensation Endorsement |
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Definition
| Used when an employer wishes to provide Workers' Compensation benefits to employees even though the law does not require the employer to provide coverage. |
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Term
| Foreign Coverage Endorsement |
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Definition
| Makes the coverage under a Workers' Compensation Policy around-the-clock, continuous coverage for those employed in foreign operations or endeavors. |
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Term
Premium Computation:
Manual Rating (Job Classification) |
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Definition
| The rates for Workers' Compensation are based upon job (work) classifications. Each job classification has a corresponding manual rate. Rates are higher for higher-risk occupations. |
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Term
Premium Computation:
Experience Rating |
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Definition
| Used to encourage employers to decrease the frequency and severity of accidents, by basing premium on the prior loss experience of the employer. |
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Term
Premium Computation:
Premium Discount |
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Definition
| Takes into account the fact that certain expenses included in the premium rate are fixed and do not increase as the size of the risk increases. Therefore, larger risks receive a "discount" as credit for those expenses that do not increase proportionately with the risk. |
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Term
Premium Computation:
Participating Plans |
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Definition
| The insured is eligible for a premium refund (dividend) if the experience over the policy period falls within the guideline established by the insurer. This provides effective insurance based upon the current policy. |
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Term
Other Sources of Coverage:
Assigned Risk Plan (Residual Market Plan) |
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Definition
| If an employer is unable to purchase coverage in the voluntary market, many states offer an employer this kind of coverage. |
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Term
Other Sources of Coverage:
Self-Insurance Plans and Employer Groups |
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Definition
| All states, except North Dakota & Wyoming, allow employers to self-insure upon satisfying certain statutory requirements that are a guarantee of their ability to meet their obligations. |
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