Workers Compensation Coronavirus Claims – Will Workers Compensation Insurance Cover These Claims?
Coronavirus has emerged as one of the nation’s greatest challenges, and you can rest assured that ensuing workers compensation coronavirus claims will rock the insurance industry. Experts predict a flood of coronavirus-related workers compensation claims, and premium increases may soon follow. The best time to control your workers compensation premiums is at each fiscal quarter when personnel changes may impact your payroll figures.
This article will cover when workers compensation claims are “compensable” or “accepted” by the insurers. It will also offer a few tips to help you manage your premiums and other personnel-related exposures during this national emergency.
When is a Workers Compensation Coronavirus Claim Compensable?
A carrier accepts an illness-related workers compensation claim when the claim meets two conditions.
1. The illness must “arise out of the course and scope of employment.”
2. The cause of the illness must be a condition peculiar to that workplace and not a disease of life, like a cold, to which everyone is exposed.
COVID-19 will be widespread, and the greater the spread, the less insurers will be inclined to find the typical employee at greater risk than the general public. Clearly, first responders of all types and caregivers, such as doctors and nurses and nurse aids, will no doubt find coverage for their illness.
For other essential workers, however, the path to compensability will be less clear. Service workers, such as plumbers who work with pathogenic materials like sewage, will no doubt have their claims accepted. Workers compensation insurers are scrambling to develop investigative templates that will help them determine compensability on a case-by-case basis.
Workers compensation laws are state specific. Some jurisdictions may pass laws that offer coverage under certain conditions. Several states, including Louisiana, will soon consider bills that make the COVID-19 a covered workers compensation illness for all essential workers.
What to Do If Your Employee Becomes Ill with COVID-19
If your employee, such as a cashier, becomes ill with coronavirus, don’t make the mistake of refusing to submit a claim to your workers compensation carrier. Even if you disagree with the claim’s validity, it is your employee’s right to file a workers compensation claim if he or she feels the injury or illness resulted from employment.
Once you’ve submitted the claim to your insurer, assure your employee that the insurer will do their best to find coverage for the employee, if it’s in order.
Never tell your workers that, if infected, “You will have coverage.” Only the carrier can make that decision. An Arizona plumbing company recently held a COVID-19 meeting and this issue arose. One of the plumbers asked, “If we get sick, are we covered?” The owner responded by saying, “While I can’t tell you for certain, I can say that your work with sewage would probably make it a covered claim. But it’s up to the insurer to decide.” This gave the employees some confidence to continue their daily routines.
Do not waive any of your rights to later allow the insurer to deny the claim. Also, be sure that you do not give your workers false confidence that the carrier will accept and handle their coronavirus claims if they get ill. Telling an employee, “I don’t know, but I’ll check and get back to you,” is often the best way to handle these important issues. In these times, your internal risk management expertise and good advice from your broker or insurance carrier can help. Call us if you have questions or we can help in any way.
The Centers for Disease Control offer employer guidelines for COVID-19 employment issues here.
Layoffs and Reductions in Force May Lower Your Estimated Workers Compensation Premiums
Is COVID-19 causing reductions in your workforce? Are you expecting savings at your end-of-year workers compensation audit? You could qualify for those savings now. First, ask yourself these questions. Do you have fewer workers compared to last year? Did you outsource any services this year instead of using your own workers? What if any differences can you find in your payroll figures over the past few quarters? Is your payroll lower from reductions in force?
If so, make a date with your insurance broker to review your payroll numbers. Also, examine the class codes of your workers. Lower payroll and fewer class codes equal lower workers compensation costs. If you qualify, don’t wait until year’s end to realize those savings.
Consider Employment Practices Liability Insurance
When employers face layoffs or other job cuts, employment practices liability insurance (EPLI) can provide several benefits. EPLI offers protection against employment decisions such as reductions in force. Many EPLI carriers also offer a helpline and other resources so you aren’t making difficult employment decisions without expert advice. If you don’t currently have this coverage, call us for a no-obligation quote. EPLI insurance can help business owners navigate choppy waters like those currently facing the nation.
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