What is Workers Comp Insurance?
Workers' compensation insurance covers injuries and occupational diseases picked up at work. Fault doesn't matter; employers are liable even if the employee may have contributed to the injury or illness. It's required in every state except Texas, and specifics vary from state to state.
Why do we need this?
The laws in almost all states require you to have workers' compensation insurance if you have employees. Workers' comp is a no-fault system designed to protect employees who are made ill, injured or killed on their job--and also to protect employers from financial ruin due to negligence lawsuits.
Who needs it?
Not every employer needs workers' comp - in some states, small companies with fewer than three to five employees don't. Many states also give the employer the option to self-insure, that is, to cover the costs flowing from on-the-job injuries themselves. Whether this is a good idea depends on the business you're in and the financial state of your company.