AD BANKER AL P&C CH 14 WORKER'S COMPENSATION

Which part of the Workers' Compensation and Employers Liability policy pays all compensation and other benefits required by the state's Workers' Compensation law? A. Part One - Workers' Compensation B. Part Two - Employers Liability C. Neither answer D. Both answers

A. Part One - Workers' Compensation: is the compensation part of the Workers' Compensation Policy. This is the part of the policy that promptly pays the compensation benefits due as a result of a work related injury or illness. Part Two covers the insured's obligations under common law to pay for work-related injuries and occupational diseases. Obligations under common law means the insured/employer must be proven legally liable.

Part Two - Employers Liability has which of the following occupational 'Accident Limits'? A. $100,000 per accident B. $200,000 per person C. $200,000 per accident D. $50,000 per person

A. Part Two is the Employers Liability section of the policy. Liability covers all claims the employer is obligated to pay according to common law. Liability always has established limits. The minimum limits required in Workers' Compensation are: $100,000 per accident for injuries, $100,000 per person for disease. This question is asking for accident limits.

Which Federal Workers' Compensation law covers postal workers? A. Federal Employee Liability Act B. U.S. Longshoremen and Harbor Workers' Compensation Act C. Outer Continental Shelf Lands Act D. Jones Act

A. The Federal Employee Liability Act covers federal employees like postal workers, etc.

Prior to the enactment of Workers' Compensation laws, employers regularly used all of the following defenses against negligence suits brought by injured employees, EXCEPT: A. Employer Liability B. Assumption of Risk C. Fellow Servant D. Contributory Negligence

A. There were 3 defenses used by employers prior to Workers' Compensation. The employer might charge that one of the following was at fault: 1. Fellow Servant - or fellow employee caused the injury and would suggest that you should sue him/her. 2. Assumption of Risk - you accepted the risks that come with the job when hired, ex. Coal miner. 3. Contributory Negligence - your contributory negligence caused the injury, ex. Not wearing safety glasses, loose clothes, etc.

In Workers' Compensation, an experience rating over 1.0 will cause: A. A premium increase B. No change C. All of the answers listed D. A premium decrease

A. Under a 1.0 experience modification factor would cause a rate decrease or discount. Any ratio above 1.0 would cause a rate increase. A 1.0 ratio, rate would remain the same.

In states that have competitive Workers' Compensation funds: A. The employer is required to purchase insurance from an Assigned Risk type plan B. The employer may purchase insurance from either the state or a private insurer C. The employer is not required to provide insurance, it is strictly voluntary D. The employer is required to purchase insurance only from the state, because it is a monopolistic state

B. Competitive state funds give employers a choice between purchasing Workers' Compensation insurance from a state fund or a private insurance company.

Which of the following has the greatest impact on Workers' Compensation rates? A. All of the answers listed B. Frequency of claims C. Severity of claims D. Type of Accident

B. Frequency of claims has the greatest impact on Workers' Compensation rates.

Part Two - Employers Liability has which of the following occupational 'Sickness Limits'? A. $100,000 per accident B. $100,000 per person C. $200,000 per accident D. $200,000 per person

B. Part Two is the Employers Liability section of the policy. Liability covers all claims the employer is obligated to pay according to common law. Liability always has established limits. The minimum limits required in Workers' Compensation are: $100,000 per accident for injuries, $100,000 per person for disease or sickness. This question is asking for sickness limits.

Coverage for sums an employer becomes legally obligated to pay under common law as a result of a work-related injury to an employee is provided by: A. Part Three-Other States Coverage B. Part Two-Employers Liability section of the Workers' Compensation policy C. Part Four-The Insured's Duties if Injury Occurs D. Part One-Workers' Compensation section of the Workers' Compensation policy

B. Part Two is the Employers Liability section of the policy. Liability covers all claims the employer is obligated to pay according to common law. Part One pays compensation and benefits required by state Workers' Compensation laws. Part Three and Four do not address liability benefits.

Which of the following types of benefits is generally not provided by a state's Workers' Compensation law? A. Rehabilitation B. Mental Anguish C. Medical D. Disability

B. Workers' Compensation generally provide four types of benefits: Medical, Disability(loss of income), Death (Survivor), and Rehabilitation. Remember the Acronym 'MDDR' for the four types of mandated benefits.

All of the following are ways of funding Workers' Compensation benefits, except: A. Private insurance B. Self insurance C. Employee paid premiums D. A monopolistic or competitive state fund

C. Employees do not contribute to the premium cost of Workers' Compensation. Premiums are paid by the employer. Workers' Compensation may be funded through private insurance companies, self insurance, monopolistic, or competitive state funding.

In MOST states, Workers' Compensation laws are: A. Voluntary B. Elective C. Competitive D. Compulsory

D. Compulsory means, required by law. MOST states are compulsory. Elective states are where employers may accept or reject state Workers' Compensation laws, these are considered voluntary. Competitive states are where states allow private insurance companies into the state to provide Workers' Compensation benefits. They compete for the business.

In a monopolistic state, an employer purchases Workers' Compensation insurance from: A. An elective company B. A compulsory company C. An assigned risk plan D. A state fund

D. Monopolistic states do not allow employers to purchase Workers' Compensation insurance from a private insurance company. An employer must obtain coverage from a state fund.

Which of the following is NOT a level of disability recognized by most state Workers' Compensation statutes? A. Temporary partial B. Permanent partial C. Temporary total D. Partial total

D. There is no such term as Partial total. Can't be both Partial and Total.

Medical benefits under the Workers' Compensation policy are: A. Paid once the employer has been proven legally liable for the injury B. Limited per policy period C. Limited per accident D. Not subject to time or dollar limits unless they are specified in the state law

D. Workers' Compensation Benefits are determined by state law. Medical benefits are normally unlimited unless state law specifies otherwise. They are not limited per policy period nor per accident. Medical benefits are paid regardless of negligence by the employee or employer.