Under workers' compensation insurance, who pays the premiums?

In the context of workers' compensation insurance, the responsibility for paying premiums falls solely on employers. This system is designed to provide compensation for employees who experience work-related injuries or illnesses, ensuring that employees receive necessary medical care and wage loss benefits without lawsuits. Employers are required by law to maintain this insurance, which not only protects their workers but also shields them from potential legal liability related to workplace injuries.

The premium amounts are typically based on several factors, including the type of industry, the company's payroll size, and the company's claims history. Since employers are in control of their workers' compensation insurance policies, they bear the financial burden of the premiums alone, which helps create a stable funding mechanism for the insurance system.

In contrast, employees do not share in the payment of these premiums, and neither do state governments or workers' unions, as they have different roles and responsibilities in the overall workers' compensation framework. By having employers cover the costs, the intention is to incentivize them to maintain safe working environments and to minimize workplace injuries.