The average cost of a single injury on a construction site is $35,000. That’s a significant sum of money that could threaten your business’s health moving forward.
It’s one reason why every contractor should hold workers’ compensation insurance. Keep reading to find several more examples of why having this insurance is so important.
1. Construction Sites Are Dangerous
The U.S. Bureau of Labor Statistics says there are approximately 150,000 construction site injuries yearly. Some of these are minor, but others lead to deaths. Unfortunately, it’s impossible to predict the severity of the next injury that occurs on your site.
Even if you take all of the precautions in the world, accidents can still happen in the world of construction because it’s a risk-prone industry. Workers’ compensation insurance will help your contracting business remain prepared for the future.
2. Workplace Injuries Can Be Extremely Costly
As we mentioned in the introduction to this article, construction injuries can cost upwards of $35,000 on average. That’s a huge sum of money that will eat into your operating budget for the rest of the year and beyond.
It’s also important to note that $35,000 is just the average. If an employee has a particularly severe injury on your site, your charges could be well into the hundreds of thousands or even higher.
When you have workers’ compensation for contractors, you won’t be responsible for paying all of this money yourself. Instead, after you clear your deductible, your insurance company will cover the remaining expenses on your behalf.
3. Your Employees Deserve It
Given the high potential costs of a workplace injury, your business may not always have the cash on hand that employees are entitled to through worker’s compensation. If that situation arises, your workers may struggle to keep up with their medical and daily living expenses until you figure it out.
With worker’s compensation, you don’t have to worry about this. Your employees will always get the funds they’re entitled to regardless of your company’s financial health. They deserve the least for assuming the risk of working on a dangerous construction site for you.
4. It Covers More Than Medical Costs
It’s also important to note that workers’ compensation covers more than just the medical costs that an employee receives after suffering an accident on your job site. This insurance also covers the following:
- Retraining
- Lost wages
- Permanent injury
- Survivor benefits
- Employer liability
- Potentially even attorney and legal fees
The exact items that you have coverage for will depend on the plan that you select. But choosing a comprehensive plan will make sure that every financial angle of a workplace injury is taken care of so that you don’t have to worry about it yourself.
5. You May Be Legally Obligated To Have It
You should also know that many states require contractors to have a valid workers’ compensation plan in order to continue operating. If you live in one of these states, then you have no choice but to hold workers’ compensation insurance or else risk facing hefty fines and penalties from your Secretary of State.
You can use this resource to look up the requirements in your state.
6. It’s Customizable
Some contractors might only want certain types of workers’ compensation coverage – especially if they have some overlapping coverage in this area through another insurance plan. That might cause them to hesitate to purchase a worker’s compensation plan.
However, it’s important to know that workers’ compensation insurance plans are entirely customizable. You don’t have to pay for any extra coverage that you don’t want to pay for.
All you need to do is reach out to an insurance company and let them know what kind of coverage you need on your job site. They’ll take that information and come up with a quote for you that only involves that type of coverage.
This way, you can get the protection you need through workers’ compensation without facing higher monthly premiums. In other words, you’ll always be able to build a customized plan that matches your needs.
7. It’ll Help You Get More Clients
Finally, when a client looks for a contractor, they want to make absolutely sure that they hire someone who is prepared for any situation that may occur on the job site.
Many won’t want to hire a contractor without workers’ compensation insurance because they know the contractor’s business could be at risk, and the project will likely shut down if a serious injury occurs.
Making sure that you have a worker’s compensation plan in place will help you avoid this potential pitfall when looking for new clients. Moreover, it may be just what you need to take the next step toward your growth goals.
