Workers Compensation for FL Adjuster Claim Professional Exam
Fast Facts
- No-fault benefits: Payable regardless of employee negligence or employer fault.
- Compulsory in most states: Employers must pay benefits as per state law.
- Coverage: Applies to all employments except:
- Very small employers
- Domestic, agricultural, or casual employees
- Independent contractors
- Sole proprietors/partners (unless they opt for coverage)
- Non-covered injuries:
- Intentionally self-inflicted
- Due to intoxication/drug use
- While attempting to injure someone else
- While committing a crime
- Benefit categories: Medical, disability, rehabilitation, death.
- Insurance options: Monopolistic state funds, private market, competitive state funds, or residual market plans.
Workers comp provides financial relief for job-related injuries, illnesses, or deaths without regard to fault.
History of Workers Compensation
Before the 1900s, injured workers had to sue employers, facing defenses like:
- Assumption of Risk: Employees assume responsibility for known job risks.
- Contributory Negligence: Employee negligence bars recovery.
- Fellow Servant Rule: Employer not liable for injuries caused by another employee.
A warehouseman denied recovery for a back injury due to "assumption of risk" from heavy lifting.
Workers comp laws, starting in Wisconsin (1911), eliminated these defenses, providing no-fault benefits.
Workers Compensation Laws Today
Compulsory: Most states require employers to provide benefits (except Texas and New Jersey, where it's elective).
Exclusive Remedy: Benefits are the sole remedy; employees cannot sue employers unless the employer lacks insurance or intentionally causes harm.
Penalties for non-compliance include fines, criminal charges, or increased employee benefits (10-200% extra).
Workers Compensation Benefits
- Medical: Covers treatment costs, often unlimited in amount/duration.
- Disability:
- Temporary Total: Unable to work but expected to recover (66⅔% of wages).
- Permanent Total: Unable to work for life.
- Temporary Partial: Can work but at reduced wages.
- Permanent Partial: Permanent impairment but can work (often based on scheduled injuries).
- Rehabilitation: Covers retraining and related expenses.
- Death: Burial allowance and weekly income for dependents.
Disability benefits have a waiting period (e.g., 3 days), acting like a deductible.
Employers Liability Insurance
Covers lawsuits from employees not covered by workers comp, such as:
- Excluded employees (e.g., farm labor)
- Employers not subject to workers comp
- Third-party-over actions
- Family member claims for consequential injuries
Work-Related vs. Non-Work-Related Claims
Requirements for coverage:
- Injury/illness occurred
- In the course of employment (on premises during work hours)
- Arises out of employment (job-related hazards)
For wage replacement: Prove impairment and wage loss.
Insurance Markets
- Monopolistic State Funds: ND, OH, WA, WY (only state fund coverage).
- Voluntary Private Market: Available in most states.
- Competitive State Funds: Compete with private insurers in ~20 states.
- Residual Market Plans: For businesses unable to get coverage elsewhere.
Federal Workers Compensation Laws
- LHWCA: Maritime workers (loading/unloading vessels).
- OCSLA: Offshore workers (e.g., oil rigs).
- Jones Act: Seamen with negligence remedy.
- FELA: Interstate railroad workers.
Test Your Knowledge!
Question 1: An injured employee who accepts workers comp benefits can generally sue their employer.
False: The exclusive remedy provision prevents suing the employer in most cases.
Question 2: Which is NOT a standard workers comp benefit?
- Death benefits
- Long-term care benefits
- Rehabilitation benefits
- Medical benefits
Long-term care benefits are not a standard workers comp benefit.