Chapter 14 : Workers' Compensation Insurance

Covered Employment Injuries

- The injury must occur while the employee is at work or working - The employee is working the hours they are designated or expected to work - The employee is performing the duties that they were employed to do The injury must arise from a risk that is reasonably related to employment

North Carolina Regulations : Claim Denial

A claim denial must specifically state the reason for the denial. Notice of denial must be sent to the Commission and the employee within 14 days after the employer receives notice of the injury or death, or within a reasonable time approved by the Commission. An employee may request a hearing about a claim denial within 2 years after the date of injury.

Temporary Partial Disability

An injury after which an employee is able to do some work, but is unable to earn their usual wage until full recovery. Benefits are usually calculated as a percentage of the difference in the wages. An employee who returns to the workforce after a temporary disability at a lower rate of pay is entitled to 66 2/3% of the difference in wages, up to the state maximum weekly compensation rate, for a fixed period of up to 500 weeks.

Permanent Partial Disability

An injury after which an employee is able to do some work, but will never fully recover. An employee can still earn a wage, but not as much as they would have earned if the injury had not occurred. An employee suffering a permanent disability is entitled to a benefit of 66 2/3% of the employee's average weekly wage. The period of payment is based on the part of the body with the disability, a schedule of the maximum pay period for the injury, and the degree of disability. The percentage of disability will be determined by a physician's rating of the physical permanent impairment For example, if an employee has a permanent impairment to a hand, which can have a benefit pay period of up to 200 weeks, and a physician determines a 50% impairment rating, the employee will be paid the weekly compensation rate for 100 weeks.

Death Benefits

Death benefits are 2/3 of either the average weekly wage or the maximum compensation rate for 500 weeks, or possibly longer if benefits are payable to a minor child or disabled spouse. $10,000 for funeral expenses, as well as final medical expenses, are also covered. Death benefits are payable to beneficiaries when an employee dies within the later of: - 6 years after the occupational disease or accident that caused the employee's death - 2 years after the final determination of the disability that caused the employee's death

North Carolina Benefits Provided

Each state determines benefit levels, benefit types, and definitions of disability. benefits are typically paid weekly, and the rate must be between $30 and a maximum compensation rate that is adjusted annually The weekly compensation rate is computed by averaging all wages earned by the employee during the 52 weeks prior to the injury. Overtime, paid holidays, and special allowance for lodging are included in the wages, but only wages related to the employment where the employee was injured will count toward this average. There are no cost of living increases, so the compensation rate will remain the same for the duration of the claim.

General Section

The Policy - Establishes that the policy is a contract between the employer and the insurer. The terms of the policy may not be changed or waived, except by endorsement. Who Is Insured - Establishes that the employer is the insured. Workers' Compensation Law - The law of each state or territory named in the Information Page. State - Any state in the United States, including the District of Columbia. An injured employee is entitled to benefits provided by the state where the injury occurs. Locations - All workplaces, locations, and states listed in the Information Page.

Part Five - Premium : Classifications

The classifications shown in the Information page are assigned based on an estimate of the exposures the insured would have during the policy period.

Part One - Workers' Compensation Insurance : Statutory Provisions

The following apply as required by law: - Notice of an injury must be given promptly - Bankruptcy of the insured does not relieve the insurer of its duties under the policy - The insurer is liable to any person entitled to benefits under the policy - Under the Workers' Compensation law of the applicable state(s), jurisdiction over the insurer is jurisdiction over the insured - The policy will conform to Workers' Compensation laws that apply to benefits and assessments payable under the policy, such as taxes, special funds, etc. - Terms of this policy that conflict with state law are automatically changed to conform

Part Two - Employers Liability Insurance : How it Applies

This insurance applies to bodily injury by accident, by disease, or resulting in death. The bodily injury must: - Arise out of, and in the course of, employment - Take place during the policy period - Be caused by the conditions of employment The employment must be necessary to the work described in the Information Page. Any suits for damages for bodily injury must occur in the United States, its territories and possessions, or Canada. Employees cannot purchase supplemental benefits

Monopolistic States

Workers' Compensation insurance is only available through a state fund.

Example of Occupational Disease

an employee who contracts a cold in the winter may not be eligible for benefits because the cold could have been contracted while the employee was not working However, a coal miner who develops respiratory problems will likely be eligible for benefits.

Part Two - Employers Liability Insurance : What will the Insurer Defend

any claim for benefits payable by this insurance. The insurer reserves the right to investigate and settle claims.

Definition of Employer in NC

- Any person carrying on any employment - The state, its political subdivisions, and public and quasi-public corporations in the state - The board of commissioners in each county, considered to be the employer of the county's deputy sheriffs - North Carolina Forest service, considered to be the employer of authorized firefighters engaged in emergency fire suppression

Part Two - Employers Liability Insurance : Exclusions

- Liability assumed under a contract - Punitive damages awarded because an employee was employed in violation of law - Bodily injury to an employee while employed in violation of law - Any obligation imposed by any Workers' Compensation, Occupational Disease, Unemployment Compensation, or Disability Benefits law - Bodily injury intentionally caused by the insured - Bodily injury caused outside of the United States, its territories and possessions, or Canada. Injury to a resident temporarily outside of these areas would be covered. - Damages arising out of coercion, criticism, defamation, evaluation, reassignment, discipline, harassment, humiliation, termination of, or discrimination against any employee, as well as arising from any personnel practices, policies, acts, or omissions - Bodily injury arising from work that falls under federal jurisdiction - Fines or penalties imposed for a violation of federal or state law - Damages payable under the Migrant and Seasonal Agricultural Worker Protection Act

The following is not considered employment covered by Workers' Compensation:

- Part-time, seasonal agricultural work - Domestic services

In North Carolina, employment covered by Workers' Compensation includes:

- State employment, including employment by all political subdivisions - Public and quasi-public corporation employment - Private employment with 3 or more employees regularly employed in the same business or establishment, except that employment in activities involving radiation requires 1 or more employees - Full-time, nonseasonal agricultural work with at least 10 regular employees - Sawmill/logging operator with less than 10 employees, if the business has less than 60 days of operation in any 6 consecutive months and the principal business is unrelated to sawmilling or logging

Part Five - Premium : Insurer's Manuals

All premiums are determined by the insurer's manuals of rules, rates, rating plans, and classifications as authorized by state law.

Disfigurement

An employee may receive additional compensation of up to $20,000 for facial disfigurement and up to $10,000 for bodily disfigurement. Disfigurement includes the loss or crowning of permanent teeth.

Self-Insurance

An employer may not self-insure its Workers' Compensation liabilities unless licensed by the Commissioner of Insurance. An application for licensure to self-insure must be filed with the Commissioner at least 90 days before the proposed licensing date. The North Carolina Self-Insurance Security Association must recieve an application at the same time If the license is denied, the applicant has 60 days to correct any deficiencies without having to reapply. An applicant for a Workers' Compensation self-insurance license must have at least $500,000 in total fixed assets. Self-insurers must submit annual financial reports within 120 days of the end of the fiscal year.

Permanent Total Disability

An injury that prevents an employee from being able to do any work for the rest of their life. Benefits are subject to the same weekly benefit percentage as provided for temporary total disability. An employee who is permanently and totally disabled is entitled to weekly benefits, including medical benefits, for life. For employees with severe paralysis from a spinal injury, severe brain or closed head injury, or major second- or third-degree burns, those benefits are paid unless the employer shows sufficient evidence that the employee is capable of returning to suitable employment.

3 Common Law defenses an insurer could have used to avoid paying claims before Workers' Compensation

Assumption of Risk - This defense placed all the risk on the employee as being responsible for knowing the work conditions prior to employment Fellow Servant Rule - Removed the employer's negligence if a fellow employee contributed in any way to the loss Contributory Negligence - Used to argue that the employee was partially at fault and therefore was not eligible to recover benefits from the employer

Medical Compensation (Benefits under WC)

Employers must provide all reasonable medical, surgical, hospital, nursing, and rehabilitative services that will provide a cure, provide relief, or lesson the period of disability. These services include, but are not limited to: - Attendant care services prescribed by a health care provider - Vocational rehabilitation - Medicines, sick travel, and medical and surgical supplies as reasonably required The costs of this medical compensation are in addition to disability benefits. The employer or the insurer may select the physician who will provide treatment. If the employee is dissatisfied with the services they receive, they may request that the Commission order a change of treatment to a physician chosen by the employee, and the request must show that the change is reasonably necessary to provide a cure, provide relief, or lesson the period of disability. If the employee's request is denied by the Commission, and the employee refuses to cooperate with the employer's selected physician, compensation may be suspended while the refusal continues.

he standard NCCI policy is only 6 pages because the details regarding payment of benefits are contained in each state's Workers' Compensation act and statutes. The policy contains the following parts:

General Section Part One - Workers' Compensation Insurance Part Two - Employers Liability Insurance Part Three - Other States Insurance Part Four - Your Duties If Injury Occurs Part Five - Premium Part Six - Conditions

Part Four - The Insured's Duties if Injury Occurs

If injury occurs, the insured's duties are to: - Provide for immediate medical services required by law - Give the insurer the names and addresses of the injured persons and any witnesses - Promptly forward all notices, demands, and legal papers related to the injury to the insurer - Cooperate with the insurer's investigation - Do not interfere with the insurer's subrogation rights - Do not voluntarily make any payments, assume obligations, or incur expenses

Part Six - Conditions : Cancellation

If the policy is cancelled by the insurer, the insurer must provide written notice to the insured, stating when the cancellation will take effect. Generally, the insurer must give the insured at least 10 days' written notice. The policy will end on the day and time stated in the cancellation notice. This policy will automatically comply with any changes in the law regarding cancellation.

Disability Income Benefits

In addition to medical benefits, a disabled employee is entitled to receive loss of time benefits—wages that would have been earned in the absence of the disability—based on the type of disability. Benefits are generally limited to the period of disability.

Federal Workers' Compensation Laws

In addition to state Workers' Compensation programs, federal laws governing certain types of employees: - The Federal Employers Liability Act (FELA) applies to interstate railroad workers - The U.S. Longshoremen and Harbor Workers' Compensation Act applies to workers who load, unload, build, or repair ships (but not to the crew of the ship) - The Jones Act or Merchant Marine Act of 1920 applies to sailors injured by the negligence of others - The Federal Employees Compensation Act applies to all U.S. civilian employees - Defense Base Act applies to workers on military bases outside the United States

Part One - Workers' Compensation Insurance : North Carolina Notice Requirements

In order to obtain benefits, an employee must give the employer written notice of the accident within 30 days of the accident. In instances of occupational disease, notice should be given within 30 days of being diagnosed by a competent medical authority. This requirement does not apply to : - asbestosis - silicosis - lead poisoning The statute of limitations to file a claim is 2 years. Notice is given by filing Form 18, which must include a statement of the injury. This notice is given to: - the Industrial Commission and - the employer or its insurance carrier Employers must keep a record of all injuries All injuries resulting in medical payments in excess of $2,000 or resulting in more than 1 day's lost time from work must be reported to the Commission using Form 19. A copy of Form 19 and a blank Form 18 must be provided to the employee.

Part Six - Conditions : Inspection

The insurer has the right, but not the obligation, to inspect the insured's workplace. Inspections are for purposes of underwriting and determining premium and not as a guarantee of safety or compliance with state or other laws.

Part Five - Premium : Audit

The insurer may audit records pertaining to the policy at any time and for up to 3 years after the policy period ends. This audit determines the final premium.

Part One - Workers' Compensation Insurance : Recovery From Others (Subrogation)

The insurer reserves the right to recover its payments from anyone liable for causing injury.

Part Two - Employers Liability Insurance : Recovery From Others (Subrogation)

The insurer reserves the right to recover its payments from anyone liable for injury.

Part One - Workers' Compensation Insurance : What will the Insurer Defend?

The insurer will defend any claim for benefits payable by this insurance. The insurer reserves the right to investigate and settle claims.

Part One - Workers' Compensation Insurance : Other Insurance

The insurer will not pay more than its share of the benefits and costs covered by the policy.

Part Two - Employers Liability Insurance : Other Insurance

The insurer will not pay more than its share of the benefits and costs covered by the policy.

Part Two - Employers Liability Insurance : What the Insurer will pay

The insurer will pay the sum, up to policy limits, and the insured must legally pay for damages because of bodily injury to employees. The bodily injury must be covered by Part Two - - Employers Liability Insurance, and the damages paid by the insurer include: - Those for which the insured is liable to a third party because of a claim - Care and loss of service - Consequential bodily injury to an injured worker's spouse, or immediate family member - Actions brought against the insured in a capacity other than as an employer, also known as the Doctrine of Dual Capacity

Part One - Workers' Compensation Insurance : How and what will the Insurer Pay?

The insurer will promptly pay the benefits due. he following amounts, in addition to other amounts payable: - Expenses incurred by the insured, at the request of the insurer, but not loss of earnings - Premiums for appeal bonds - Litigation costs taxed against the insured - Interest on a judgment against the insured - Expenses incurred by the insurer

Part One - Workers' Compensation Insurance : Payment the Insured Must Make

This is the Exclusion section of the policy. The insured is responsible for paying benefits in excess of those provided by the Workers' Compensation law, including those required because of the: - Insured's serious or willful misconduct - Insured knowingly employing an employee in violation of law - Insured failing to comply with health or safety laws - Insured firing, coercing, or otherwise discriminating against any employee If the insurer makes any excess payments, the insured must promptly reimburse the insurer.

Part Three - Other States Insurance

This policy is designed to provide coverage for as many states as the laws permit. Employers with operations in the monopolistic states must purchase coverage directly from the state entity that sells this coverage. Otherwise, agents can adapt this policy for their customers to include very broad national coverage as long as the Information page shows the states in which they have active operations and may have potential exposures. This insurance applies only if more than one state is listed, and must be within the policy territory (monopolistic states may not be listed here). If the insured begins work in a state listed on the Information Page after the effective date of the policy, the insurance will apply if other insurance does not exist. The insurer will reimburse the insured for any payments made where insurance applies, and the insurer is not allowed to pay directly. The insured must notify the insurer within 30 days when an employee works in a state not listed in the Information page.

Exempt Workers in NC

Under Workers' Compensation, an employee does not include: - Any person whose employment is both casual and not in the course of the trade, business, profession, or occupation of their employer - Any person performing voluntary service as a ski patrolman who receives no compensation for their services other than meals, lodging, or the use of ski facilities - Domestic workers - Farm laborers when the employer has fewer than 10 full-time, nonseasonal employees - Railroad workers, unless employed by a state-owned railroad company or for work on electric street railroads - People who are incarcerated, unless assigned to work for an employer - Taxicab drivers, who are considered independent contractors The nonprofit may provide Workers' Compensation to these volunteer officers if it elects to do so. Members of a nonprofit who work voluntarily are exempt, but if the nonprofit employees at least 1 person, the volunteers can be counted for the purpose of determining number of employees Sole proprietors, partners of a business, and members of a limited liability company are not considered employees. However, they may elect to be included as employees if they are actively engaged in the operation of the business.

North Carolina Regulations : Communication with Medical Providers

When an employer pays for medical treatment for an employee because of occupational disease, the employer is entitled to relevant medical records without the express authorization of the employee. These records include those related to the evaluation, diagnosis, or treatment of the injury or disease that is being compensated. If the employer is not paying for medical compensation, it must provide the employee with written notification of their request to the medical provider. - If the employee requests, the employer must give a copy of any records received to the employee within 30 days. The employer may also communicate with the employee's health care provider in writing without express authorization in order to collect information not available in the employee's medical records. This information includes : - diagnosis - appropriate treatment - anticipated time out of work - the kinds of work the employee is restricted from or able to do A copy of the provider's response must be sent to the employee within 10 business days of the employer receiving the response. An employer that requires relevant information not available through the employee's medical records or through written communication with the provider may use oral communication, but the employee must be notified prior to the communication and given an opportunity to participate in the conversation at a mutually convenient time. If the employee declines to participate or does not respond, a summary of the conversation must be provided within 10 business days. If an employer has additional relevant medical information not contained in the employee's medical records, it may communicate the information to the provider. The employer must give prior notice to the employee of its intent to do so and allow for 10 business days during which the employee may consent or object to the information. If the employee timely objects, they may request a protective order from the Commission to prevent the proposed communication.

North Carolina Regulations : Compensation and Fees

When the employer or insurer admits the employee's right to compensation, the first installment is due 14 days after the employer receives notice of the injury or death. Subsequent installments are made weekly unless the Commission states otherwise An insurer must pay 10% interest on all claims not paid within 14 days after being due. Any bill for health care services must be paid within 60 days after being approved by the Commission or after being properly submitted to the insurer or managed care organization responsible for direct reimbursement. Overdue bills will also be subject to 10% interest. A health care provider may not pursue payment from an employee for a compensable injury. All agreements to pay compensation must be approved by the Industrial Commission the Commission may require additional examinations for prolonged disabilities before approving compensation. This includes attorneys, who need approval from the Commission before accepting any fee or gift for any services in connection with a worker seeking compensation.

More on Covered Injuries

When the injury or death is caused by the employer's willful failure to comply with any Workers' Compensation statute or requirement, compensation will be increased 10%. When the injury or death is caused by the willful failure of the employee to use a safety appliance or by the willful breach of any rule or regulation adopted by the employer, compensation will be reduced 10%. The employee must have been made aware of the employer's standards or safety appliance requirements prior to the injury. The burden of proof is on the party who claims an exemption or forfeiture.

Compensation for Minors with Dependents

Where a minor employee, under the age of 18 years, sustains a permanent disability or dies leaving surviving dependents, compensation will be calculated based on one of the following: - First, the average weekly wage paid to adult employees of the same employer performing a similar class of work to the injured minor employee or - Second, a wage sufficient to yield the maximum weekly compensation benefit

Survivors of Disabled Employee

Widows, widowers, and dependent children are presumed to be wholly dependent on the deceased employee for support, and the death benefit will be divided among them. Compensation is not allowed unless the dependency existed for at least 3 months prior to the accident. If an employee dies before all disability benefits are paid, the remaining benefits will be paid to the survivors, first to those wholly dependent, then to those partially dependent, and to next of kin if there are no dependents. This applies if the death is due to something other than the cause of the disability. If the death is due to the cause of the injury, then disability benefits cease, and death benefits begin.

North Carolina Rating Bureau

composed of all insurers authorized to write lines of insurance represented by the Bureau serves as the administrator of the North Carolina Workers' Compensation Insurance Plan

Definition of Employee in NC

means any person engaged in an employment under any appointment, contract of hire, or apprenticeship. The contract may be expressed or implied, oral or written. It can include minors and those who are not residents of the United States or Canada, whether employed lawfully or unlawfully. The following will also be considered employees: - Officers and employees of the state, including anyone elected by the people or the General Assembly as well as anyone appointed by the governor to serve on a part-time or fee basis - Officers and employees of municipal corporations and political subdivisions, including those who are elected by the people - All deputy sheriffs - Members of the North Carolina National Guard while on active duty, members of the Civil Air Patrol during state-approved missions, and authorized emergency workers engaged in emergency activities for the North Carolina Forest Service - County agricultural extension service employees who do not receive federal appointments will be employees of the county board of commissioners or, if they are field faculty members with professional ranks, employees of the state - The employee's legal representative, dependents, and other persons to whom compensation is payable in the event of the employee's death - Executive officers of any corporation. However, executive officers may be exempt from the required coverage if the corporation specifically excludes the officer in the insurance contract.

Second Injury Fund

pays compensation on behalf of an employer to an employee who has already suffered a prior disabling injury, and now sustains a subsequent injury, and the combination of the two injuries creates a greater disability than the second injury would have created by itself. his Fund is designed to encourage employers to hire people with disabilities by limiting their liability for subsequent injuries. The employer is responsible only for compensation that would have been paid had the second injury occurred without the existence of the prior injury The Fund will pay additional compensation in cases of second injuries, provided that the original injury and the subsequent injury were each at least 20% of the entire member. The Industrial Commission may assess against the employer or its insurance carrier a payment up to $250 for the loss, or loss of use, of each minor member in every case of a permanent partial disability. If there is a loss or loss of use of at least 50% of a major member (back, foot, leg, hand, arm, eye, or hearing), an employer or its insurer may be assessed $750 for each loss. This is not the total that the employee will receive; rather, it is the employer or its insurer's share for that particular loss.

North Carolina Self-Insurance Security Association

protects claimants in the event of a member self-insurer's insolvency

Part Two - Employers Liability Insurance

provides insurance for bodily injury and other damages for which the insured becomes liable outside of Workers' Compensation statute and occupational disease laws. If someone is permitted by law to sue the insured for negligence or other tort damages, this part of the policy applies.

North Carolina Workers' Compensation Insurance Plan (Assigned Risk Market)

the residual market for Workers' Compensation insurance when an employer is denied coverage in the voluntary market. The Bureau will issue a binder, good for 30 days, to provide temporary insurance once the deposit premium is paid, until the Bureau designates an insurer to accept the risk. The Bureau must maintain a list of employers that have been denied voluntary Workers' Compensation coverage. Failure by the employer to disclose to the Bureau any information regarding the employer's ownership, operations, payroll, or other records is grounds to terminate the policy.

4 types of Workers' Compensation coverage

1. Conventional & Open Market: Insurance agents write coverage for individual businesses. 2. Assigned Risk Market: Policies from this market are for businesses with insufficient histories or that have been unable to obtain insurance through the open market because of their risk level. 3. Self-Insured Fund: A form of blanket coverage for Workers' Compensation insurance where the business pays into a large fund that provides coverage for the business and all other contributors who pay into the fund. Contributions by each business are based on its number of employees, payroll, and the rate assigned to it by the North Carolina Rate Bureau. 4. Self-Insured: The business must go to the Department of Insurance and post bond to show it has the financial means to provide coverage for its employees.

Temporary Total Disability

An injury, from which an employee is expected to recover and return to work, but is unable to do any work while recovering. An employee who is unable to earn wages after 7 days of disability is entitled to weekly loss of time benefits of 66 2/3% of the employee's average weekly wage, up to the state's maximum weekly compensation rate. The employee is eligible for this compensation for a period of up to 500 weeks, unless they qualify for extended compensation. Compensation for the 7-day waiting period may be received if the disability lasts more than 21 days.

Occupational Disease

An occupational disease must arise out of the course of employment and be caused by conditions that are particular to that employment.

North Carolina Regulations : Fraudulent Claims

Any person who willfully makes a false statement or representation of a material fact for the purpose of obtaining or denying any benefit or payment, or assisting another to do the same, will be guilty of: - A Class 1 misdemeanor if the amount at issue is less than $1,000 - A Class H felony if the amount at issue is $1,000 or more The court may order restitution. Any health care provider who willfully or intentionally undertakes the following acts is subject to an administrative penalty not to exceed $10,000: - Submitting charges for health care that was not provided - Fraudulently administering, providing, and attempting to collect for inappropriate or unnecessary treatment or services Additionally, health care providers are subject to an administrative penalty up to $1,000 if they fail to timely file required reports or make unnecessary referrals.

employer-employee relationship exists if the employer:

Because Workers' Compensation insurance responds to workplace injuries, it only provides coverage if an employment relationship exists between the employer and the injured person. - Retains the right to direct the way work will be completed - Supplies the necessary equipment and tools to complete the work - Determines the work hours - Determines the end results of the work to be completed - Controls the frequency and timing of compensation for work

When is compensation not payable to employee

Compensation is not payable if the injury or death to the employee was proximately caused by any of the following: - Intoxication, provided the intoxicant was not supplied by the employer or their agent in a supervisory capacity to the employee - Being under the influence of any controlled substance listed in the North Carolina Controlled Substances Act, if the controlled substance was not prescribed by a practitioner - Willful intention to injure or kill one's self or another person

Benefits for Minors

Employees under the age of 18 are entitled to the same benefits as other employees if they are injured, but there are special provisions that apply Time limitations run against a minor only after a guardian has been appointed by the Commission to represent the minor's interest, or until the minor reaches age 18. Parents, legal guardians, and legal custodians may receive compensation on behalf of a minor, and they may be required to cosign agreements or payment receipts with the minor. To calculate their compensation for a period longer than 52 weeks, the minor's average weekly wage will be considered the same as the wage paid to adult employees of the same employer at the time of the accident if they are in a similar class of work.

Example of Doctrine of Dual Capacity

If an employee is injured by a product the employer manufactures, or is injured as a result of medical services the employer provides, and the injuries occur independent of the employment relationship, the Doctrine of Dual Capacity would apply.

Compulsory

In jurisdictions where Workers' Compensation benefits are mandated by state law, employers are required to provide Workers' Compensation benefits to their employees—either via insurance or self-insurance. If the provisions of a policy do not comply with the state law, the insurer is required to provide all legally mandated benefits.

Elective

In jurisdictions where Workers' Compensation benefits are not mandated by state law, employers have the choice to accept or reject state Workers' Compensation laws. If an employer chooses to reject the Workers' Compensation laws and an employee is injured, the employee may then file a claim or lawsuit against the employer for injuries, and the employer is denied the use of common law defenses, such as assumption of risk, contributory negligence, and negligence of a fellow employee.

North Carolina Regulations : Injuries

Insurers may require preauthorization for inpatient admission to a hospital, inpatient admission to a treatment center, or inpatient or outpatient surgery. Up to 10 days' advance notice may be required. Insurers must respond to requests for preauthorization within 2 business days. If an employee receives a permanent injury after having sustained another permanent injury in the same employment, they are entitled to compensation for both injuries. However, the total compensation will be paid by extending the payment period and not by increasing the amount of weekly compensation. The period of payment may not exceed 500 weeks. If an employee has previously incurred permanent partial disability through the loss of a hand, arm, foot, leg, or eye, and by subsequent accident incurs total permanent disability through the loss of another member, the employer's liability is for the subsequent injury only. If an employee is exposed to the same injurious agent at the place of business of more than one employer, the claim should be filed with the employer of the premises at which the employee was last exposed. This applies to cases of occupational disease and loss of hearing.

Types of Coverage in North Carolina

North Carolina is a compulsory and competitive state. All employers must have Workers' Compensation coverage through either a liability insurance policy or some form of self-insurance, and proof of coverage must be filed with the North Carolina Industrial Commission, which administers North Carolina's Workers' Compensation Act.

Compensation for Minors without Dependents

Temporary total disability or death benefits for a minor without dependents will be computed based on the average weekly wage at the time of the accident, unless the total disability extends more than 52 weeks.

Workers' Compensation and Employers Liability Insurance Policy

The Employers Liability section of the policy does not pay for medical expenses incurred by the injured employee. In order for the policy to pay, the insured must be legally liable for injuries and damages sustained by an employee that are not addressed by Workers' Compensation statute or that are sustained by third parties and/or dependents of the injured worker. Employers Liability pays all sums for which the insured is legally obligated to pay: - For injuries to employees that arise out of employment, but claimed against the insured in a capacity other than as employer - For care and loss of services - For consequential injury to dependents of an injured worker - For damages claimed by a third party as a result of a worker's injuries

Part Five - Premium

The North Carolina Rate Bureau sets rates for specific types of employment based on each $100 of payroll. Premiums may increase if there is an injury, and they may decrease if there are no injuries. Premiums can also change depending on the number of employees and the amount of payroll. Policies are written annually.

Part Five - Premium : Final Premium

The final premium will be determined, after this policy ends, by using the actual, not the estimated, premium basis and the proper classification that applies by law. If cancelled by the insurer : - The final premium will be calculated pro rata for the time the policy was in force. If cancelled by the insured: - The final premium will be based on the time the policy was in force and increased by the insurer's short-rate cancellation table. Deposit premium is the advanced premium charged when coverage is issued. Deposit premium is based upon estimated payroll.

Part Six - Conditions : Sole Representative

The first named insured will act on behalf of all insureds, receive any cancellation notice, and unearned premium.

Part Two - Employers Liability Insurance : The Insurer will also Pay

The following amounts in addition to other amounts payable: - Expenses incurred by the insured, at the request of the insurer, but not loss of earnings - Premiums for appeal bonds - Litigation costs taxed against the insured - Interest on a judgment against the insured - Expenses incurred by the insurer

Part Six - Conditions : Transfer of the Insured's Rights and Duties

The insured is not allowed to transfer any rights and duties under the policy without the insurer's written consent.

Part Five - Premium : Records

The insured will keep records of information needed to calculate the premium.

Part Five - Premium : Premium Payments

The insured will pay the entire premium when due.

Part Two - Employers Liability Insurance : Limits of Liability

The limits of liability shown on the Information page are the most the policy will pay for all damages covered by the policy for bodily injury by accident or bodily injury by disease. Limits may be increased upon payment of additional premium.

Part Five - Premium : Remuneration

The premium for each work classification is determined by multiplying a rate and a premium basis. The premium basis is employee remuneration.

Part Two - Employers Liability Insurance : Actions Against the Insurer

There will be no right to actions against the insurer unless: - The insured has complied with all terms of the policy - The amount owed by the insured has been determined with the insurer's consent or by trial and final judgment

Part One - Workers' Compensation Insurance : How does it apply?

This insurance applies to bodily injury by accident, bodily injury by disease, or bodily injury resulting in death. The accident must occur during the policy period, and the bodily injury must be caused or aggravated by the conditions of employment.

Benefits for Volunteers

When a volunteer fireman, member of an organized rescue squad, an authorized pickup firefighter, auxiliary police, Civil Air Patrol, etc., is temporarily disabled or is killed while performing emergency services, compensation will be calculated based on the average weekly wage the volunteer was earning in their principal employment.

Competitive States

Workers' Compensation insurance is available through private insurers as well as any state fund that may exist.