What type of insurance protects contractors from employee injuries?

Workers' compensation insurance is specifically designed to protect contractors and their employees in the event of work-related injuries or illnesses. This type of insurance provides coverage for medical expenses, rehabilitation costs, and a portion of lost wages for employees who are injured on the job. It also offers protection to employers by limiting their liability in case an employee decides to file a lawsuit related to the injury.

Understanding the function of workers' compensation insurance is essential for contractors, as it not only ensures compliance with state laws (which often mandate this coverage) but also fosters a safer work environment by encouraging injury prevention measures. In the event of an accident, this insurance helps to mitigate financial impacts on both the worker and employer, reinforcing the importance of having this type of coverage in place.

Other types of insurance, such as general liability, professional liability, and bodily injury insurance, serve different functions and do not specifically address employee injuries sustained while performing job duties. General liability insurance typically covers third-party claims for bodily injury or property damage, while professional liability insurance protects against claims of negligence in professional services. Bodily injury insurance is a broad term and is usually included under general liability or auto insurance policies. Therefore, workers' compensation insurance is the appropriate choice for protecting against employee injuries on the