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Insurance requirements for workers' compensation-Part I

Workers' compensation, by definition, is an insurance policy for businesses and employers. Workers' compensation helps employees who have been injured while they were working for that business to get due compensation. Many New Jersey residents suffer such serious injuries, including loss of limb, broken bones, and herniated disks, some of which can lead to temporarily or permanent disability. Such disabilities may compromise a workers' ability to continue in their present job or find other work. Workers' compensation, thankfully, may help an injured employee find financial stability.

New Jersey state authorities encourage all employers to get a workers' compensation insurance policy. Even in a case in which the employer is located out of the state, the employee should have a workers' compensation policy. There are essentially two ways for an employer to obtain a workers' compensation policy, which will serve in the best interest of the employee and the employer in the event that a workplace accident does occur in the future.

First, a Workers' Compensation Insurance Policy can be drafted by a stock carrier who has the authority to draft such insurance policies within the jurisdiction of the state. In such cases, the premiums are paid according to various factors, including the nature of the work that the employee has to perform as well as the history of workers' compensation claims that the employer has been subjected to in the past.

Employers can also get self-insurance for workers' compensation. That can be done by the employer and the employer's attorney, who will have to apply to the Commissioner of the Department of Banking and Insurance. Such self-insurance policies will have to be approved by the Commissioner only if the employer can prove that the employer is financially able to meet the necessary obligations in the event of a workplace accident.

All that is to say that those who have been injured on the job should be covered by their employer's workers' compensation policy. Anyone who has worked with insurance companies in the past know, though, that filing and recovering on a claim is no easy matter. This is where the experience of a skilled attorney can be beneficial.

Source: New Jersey Department of Labor and Workforce Development, "An employer's guide to workers' compensation in New Jersey," accessed on Aug. 26, 2015

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