There’s no denying that COVID-19 has changed everything, including how you run your business. From when you’re open to how you conduct business, the impact of the pandemic has been overwhelming. That impact includes workers’ compensation insurance. If you’ve had more employees file claims than in the past, you’re not alone.
Here’s how things are changing.
Burden of Proof
Infectious disease exposure in the workplace has long been a covered claim within workers’ comp coverage. That is as long as it could be shown that the workplace was the reason for an increased risk of exposure. But workers’ compensation is not built for a pandemic and how governments respond to it.
Many states have enacted presumptions that COVID-19 is work-related for specific occupations. This presumption changes one of the most basic rules of workers’ compensation: who has the burden of proof. In typical claims, an employee has to prove that they were exposed to an infectious disease in the workplace.
Under COVID-19 presumptions, the burden of proof falls to the employer. Now the employer has to prove exposure didn’t occur in the workplace. The pandemic leads to more claims not only being filed but being paid, as well.
Workers’ Compensation Costs
The next biggest change is also, currently, the greatest unknown. Under normal circumstances, workers’ comp costs are directly tied to the claims filed in a given year for a business. The idea being that when risk is lowered, claims go down, saving you money on your premiums.
In a pandemic, especially in certain fields, the risk can’t be reduced completely and claims have certainly gone up. Safety National’s data shows that healthcare is the top impacted industry by COVID-19 with first-responders (police, fire, and EMS workers) coming in second.
Due to the pandemic, workers’ comp insurers are relying more on telemedicine than ever before. This can reduce the cost of a claim because telemedicine is much less expensive than seeing a doctor in person. At the same time, though, return-to-work options are often delayed due to long-term health complications, state requirements for businesses, and other factors which can increase claims.
The biggest unknown in terms of claim costs is for long-term disability claims. With some COVID-19 patients experiencing symptoms and complications long after their initial illness, it’s difficult to know what the long-term effects this will have on workers’ comp claims. It’s safe to assume that there could be an increase in permanent partial and permanent total disability claims.
The pandemic has touched every industry, including the workers’ compensation insurance industry. More changes will arise because of COVID-19. To understand your coverage and your responsibility as an employer under workers’ comp, contact Charlotte Insurance. We can discuss risk mitigation and help you understand your policy.