You probably have heard of workers’ compensation. It is a system offering payments for medical care and lost wages due to a work accident. However, while many people have a general idea of what it is, they may not understand the details of it. Business News Daily explains that workers’ compensation is an insurance program.

Your employer carries workers’ compensation insurance to protect itself against lawsuits. This is because this insurance eliminates your right to sue your employer for a work-related accident. Instead of going to court and trying to get your employer to pay for the damages from the accident, you make a workers’ compensation claim. This does also benefit you because it is much quicker to go through this system than it is to go through the court.

In addition, state’s manage and oversee workers’ compensation, so there is a lot of regulation over the industry. Insurers that offer this insurance must follow the workers’ compensation laws. These laws help to ensure that you get quick medical care and that benefits come to you without long delays. So, it works a little different than your typical insurance.

The state does require most employers to have workers’ compensation. However, if your employer does not have it, then you retain the right to sue for damages due to injuries on the job. If your employer does not have the insurance and the law mandates that it should, it will also face administrative fines and penalties from the state.

These penalties help to ensure that employers do carry the insurance for the protection of employees. If you have to sue to claim damages, you could end up not getting anything from your employer if it cannot pay the judgment.  With workers’ compensation, you have at least some guaranteed payments for medical expenses.