For most employers in the U.S., worker’s compensation insurance is not an optional form of coverage. Instead, it’s a state-mandated program. In some areas, there is even a monopolistic organization that handles policies for all employers in the state. There are areas where worker’s compensation is not mandatory, though, like jobs that send you to locations outside of jurisdictions with those policies. Some offshore mining and refining operations fit this definition, as do many employers who send workers abroad for contracted labor in various industries. For those employers, there may be an option for worker’s compensation, but often the policy they use to protect employees is an occupational insurance policy, which has a few distinct differences.
Contrasting Workers Compensation and OAI
Workers’ compensation tends to be more expensive because of the provisions that cover workers for lost wages and medical expenses with no upper limit. By contrast, occupational insurance covers medical costs and lost wages associated with an accident up to the policy maximum, and it is up to your company to calibrate its coverage to its needs. There is a chance that under-insurance could place financial liability for a portion of the costs associated with accidents on your company, so if this policy looks like a good fit for your business, you’ll want to work with insurance experts who make occupational accident coverage the focus of their work.