Employer’s Liability Coverage
What Does Employer’s Liability Coverage Mean?
Employer’s liability coverage, outlined in Part II of a workers’ compensation policy, protects employers from liability claims arising from employee injuries that are not covered under Part I. Therefore, any employer who purchases workers’ compensation insurance automatically receives this additional layer of protection.
Insuranceopedia Explains Employer’s Liability Coverage
Workers’ compensation serves as no-fault insurance, providing benefits to employees who can demonstrate that an injury occurred on the job. However, if the injured employee or their spouse sues the employer for negligence, the employer’s liability coverage offers financial protection for the employer. For instance, if a company fails to maintain a machine that later malfunctions and injures an employee, the employee may file a negligence lawsuit. Employer’s liability would help cover expenses such as medical services, transportation to treatment, and compensation for pain and suffering, although it does not cover punitive damages.
