Workers’ Compensation

What is Workers’ Compensation?

Worker’s Comp is a state-mandated insurance program that protects you and your employees who suffer job-related injuries or illnesses. If an employee is injured while working, Workers’ Comp covers the medical expenses and a portion of their lost wages. In exchange for the benefits provided, employees also have a limited ability to sue their employer for damages – protecting you in return.

What is an Expense Constant?

You may have seen this on your quote and thought ”what is this?” Here’s the skinny:

The expense constant is a fancy term for fixed administrative costs. When an insurance company calculates your premium, there are fixed costs that don’t vary by how much coverage you purchase, such as state fees associated with issuing a policy. Those insurance expenses are constant. (Hence the clever name.)

Your Risk Class Code

As we all know, some jobs are riskier than others. For example, an Accountant’s daily job isn’t as risky as, say, cleaning windows on the Empire State Building. Your insurance carrier will assign each of your employees a risk class code, based on the riskiness of his or her job. These codes help insurance companies determine the amount of coverage needed and therefore impacts the cost of your policy. In general, the riskier the job, the higher the premium.

Are owners exempt from Workers’ Compensation?

In most states, executive officers of a corporation are included under a state’s workers compensation act unless they file for an exemption from coverage. Partners and Sole Proprietors are generally exempt automatically from coverage under each states’ act, but they may elect to opt-in for coverage.

It is the responsibility of the employer and/or its agent/representative to determine, prior to applying for coverage, the options available under a specific state’s regulations. Further, it should be noted that action taken either to elect or reject coverage under a state law does not eliminate the need for such action in additional states where the employer may have coverage or workers comp exposures.

Why do we need Worker’s Comp?

This coverage protects employers from lawsuits resulting from workplace accidents. Ultimately, Workers’ Comp coverage is beneficial for both the employer and the employee: the employer fulfills their statutory obligation to compensate employees for lost time from work, medical benefits, and rehabilitation services related to the injury or illness; and the employee receives prompt, guaranteed payment for covered injuries or illnesses and avoids potentially long and costly lawsuits.

Need Workers’ Compensation for your Business? We Can Help!

Make sure you check out our FINS website at which is our dedicated Workers’ Compensation site. You can submit your information for a Workers’ Compensation quote or speak to one of our licensed Insurance Agents @ 901-465-0011 to learn how to protect your business and your employees. We look forward to working with you!