As a business owner, you have to implement a full risk management and compliance strategy, and this includes insuring your operations and employees appropriately. One critical benefit that you should never go without is workers’ compensation insurance.

It might surprise you to know that Texas differs from most states in that it does not require businesses to carry workers’ compensation insurance. However, this is not a free pass; it simply means that the state gives businesses the choice of either getting covered or facing an employee injury claim completely on their own. The choice, therefore, should be obvious.

Understanding Workers’ Compensation Insurance

A workers’ compensation policy is designed to cover a business in case one of its employees gets hurt on the job. A variety of injuries and illnesses might qualify for coverage, from slip-and-fall injuries to chronic illnesses that come from years of working in a hazardous environment.

By filing a claim against the business’s workers’ compensation policy, an injured employee can receive replacement income, coverage for their medical expenses and other financial assistance during their recovery period. Therefore, even though a work-related injury might force this person off the job, they won’t have to worry about financial struggles, all the same.

Additionally, when an injured employee files for workers’ compensation, they surrender the right to sue the business over their injury (in most circumstances). Therefore, workers’ compensation actually works as a vessel that will reduce the business’s own liability for an employee’s injury. It makes it much easier to handle your overall responsibility for someone’s losses, without putting your own commercial assets on the line.

Texas’ Workers’ Compensation Insurance Requirements

Because of the essential role that workers’ compensation insurance plays in risk management for any business, most states require nearly all businesses to carry coverage. Texas, however, is a bit different.

Under Texas law, there is no requirement for any business to buy workers’ compensation insurance. However, the law still places full liability for employee accidents onto the employer. Therefore, if an employee does get hurt on the job, and you don’t have worker’s compensation insurance to cover them, then they retain the full right to sue your business for compensation.

As a result, by not carrying workers’ compensation insurance, you leave your business vulnerable to countless challenges that could put your overall security and sustainability at risk. Therefore, even though Texas might not require you to have coverage, the law makes it abundantly clear that employers still bear responsibility for employee injuries.

All in all, carrying workers’ compensation insurance is a much better alternative than going without. It’s much easier to factor the cost of coverage into your budget as opposed to hoping that you’ll be able to pay an employee injury claim on your own.

Also Read: Does General Liability Cover Employee Injuries?

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