Skip to main content

16.6 Part One – Workers' Compensation Insurance

The following sections are included in Part One of the standard Workers’ Compensation policy.

How This Insurance Applies​

The policy covers bodily injury caused by an accident, an occupational disease, or a work-related injury that results in death. An accident must occur during the policy period, while an occupational disease must be caused or aggravated by employment conditions, with the employee’s last exposure occurring during the policy period.

We Will Pay​

The insurer will promptly pay all covered Workers’ Compensation benefits in accordance with applicable state law.

We Will Defend​

The insurer will promptly pay all covered Workers’ Compensation benefits in accordance with applicable state law.

We Will Also Pay​

In addition to Workers' Compensation and Employers Liability benefits, the insurer pays certain supplementary payments, including:

  • Expenses incurred by the insurer in handling or defending a claim.
  • Reasonable expenses incurred by the employer at the insurer's request, excluding lost earnings.
  • Premiums for attachment bonds and appeal bonds, when required.
  • Court costs assessed against the employer.
  • Interest on judgments entered against the employer.

Other Insurance​

The insurer will promptly pay all covered Workers’ Compensation benefits in accordance with applicable state law.

Payments You Must Make​

This section outlines exclusions to coverage under Part One – Workers' Compensation Insurance. The employer is responsible for paying any benefits that exceed those required by Workers' Compensation law when the additional liability results from the employer's own misconduct, including:

  • Serious or willful misconduct by the employer.
  • Knowingly employing a worker in violation of the law.
  • Failing to comply with required health or safety laws.
  • Discriminating against an employee, such as by firing, coercing, or retaliating against the employee in violation of the law.

If the insurer makes excess payments, the insured is required to promptly reimburse the insurer for the overpayment.

Recovery From Others (Subrogation)​

The insurer has the right to recover benefit payments from any party that is legally responsible for causing the employee’s injury.

Statutory Provisions​

The policy includes provisions required by state law. The insurer is considered notified of an injury when the insured receives notice from the injured employee, and that notice must be provided promptly. The insurer remains responsible for paying covered benefits even if the insured becomes bankrupt or insolvent, and it is directly liable to individuals entitled to benefits under the policy.

For applicable Workers’ Compensation laws, the insurer assumes the insured’s legal obligations under the state’s jurisdiction. The policy automatically conforms to state law for all required benefits, assessments, taxes, and payments to special funds. Any policy provision that conflicts with state law is automatically revised to comply with that law.