Workers' Compensation and Employers Liability
A no-fault statutory system
Workers compensation pays benefits regardless of who caused the injury, and in exchange the employer receives exclusive remedy protection. Benefits include medical care (unlimited in most states), disability income - temporary total, temporary partial, permanent partial (often scheduled by body part), and permanent total - death benefits for dependents, and rehabilitation. There is no recovery for pain and suffering.
Policy structure
Part One, workers compensation, promises to pay whatever the statute requires - it has no dollar limit. Part Two, employers liability, covers the employer's tort exposure with limits stated as bodily injury by accident (each accident), bodily injury by disease (each employee), and bodily injury by disease (policy limit). Part Three lists other states.
Premium and classification
Premium equals payroll times class code rates, adjusted by the experience modification factor, subject to minimum premium, and confirmed by audit. Sole proprietors and partners are typically excluded unless they elect coverage; corporate officers may be included or excluded by election. Independent contractors are generally not employees, but a state may treat uninsured subcontractors as such.
Exclusions and defenses
Intentional self-inflicted injury, injury while intoxicated, off-duty injury, and injuries from fighting are typically excluded. Coverage territory centers on the states listed in the information page, with other-states coverage for temporary travel.
Traps
Employers liability is not workers compensation and pays no statutory benefits. Federal employees are covered under federal acts such as FELA, not state workers compensation.
Rule of thumb: when the question asks who pays even though the employer was not at fault, the answer is Part One.