Workers’ compensation claims can be very expensive for your company. Even in an incident that you could not have reasonably prevented, the claim made by a worker might increase the premiums you have to pay in the future.
There are ways that companies can reduce their liability associated with workers’ compensation claims. One involves careful scrutiny of all claims made by their employees. Another involves investing in proactive training and safety measure.
Companies can also benefit from exploring alternative liability for the incident. Subrogation is the insurance practice of one company pursuing compensation from another insurance company or separate policy because liability actually falls to the other policyholder. Workers’ compensation subrogation can be a successful way to minimize the financial impact of a workers’ compensation claim on your business.
How does subrogation potentially work after a workplace injury?
In theory, every employee who gets hurt as a part of their job can file a claim for workers’ compensation and have their costs covered. However, in some circumstances, there is a third party who is actually responsible for what happened rather than the employer.
For example, if your worker was hurt on the job because someone else crashed in to them while they were in a company vehicle, that driver – and by extension their insurance company — may be responsible for the financial implications of the collision.
Another example would be a scenario where you provide a worker with an electrical tool that has a manufacturing defect. When the device shorts out or misbehaves, the worker using it or others nearby can suffer severe injuries. The business insurance policy for the manufacturer or distributor of those products might cover the expenses involved in the incident.
Discussing subrogation and alternate liability as a means of protecting your company after a worker’s compensation claim with an experienced attorney can be a wise decision.