Property & Casualty Insurance Exam (National Portion)Types of PoliciesMedium
An employee suffers a work-related injury, resulting in temporary disability and requiring medical treatment. The employer has a Workers' Compensation policy. Which part of the Workers' Compensation and Employers Liability Policy (WC&EL) would cover the employee's lost wages and medical bills?
- APart Two - Employers Liability Insurance
- BPart Three - Other States Insurance
- CPart Four - Your Duties If Injury Occurs
- DPart One - Workers' Compensation Insurance
Show answer & explanationAnswer & explanation
Correct answer: D. Part One - Workers' Compensation Insurance
Part One of the Workers' Compensation and Employers Liability Policy specifically covers the statutory obligations of the employer under the Workers' Compensation laws, which include paying for an injured employee's medical expenses and lost wages (disability benefits) for work-related injuries, regardless of fault.
Why the other options are wrong
- A. Part Two covers the employer's legal liability for work-related injuries that fall outside the workers' compensation statutes (e.g., third-party over actions).
- B. Part Three extends coverage to states where the employer might operate but isn't listed in Part One.
- C. Part Four outlines the employer's responsibilities after an injury occurs, not the coverage for benefits.
WC&EL Part One
Part One of the Workers' Compensation and Employers Liability Policy provides coverage for the employer's obligations under the Workers' Compensation laws of the states listed in the policy, including medical expenses and lost wages for injured employees.
- Covers statutory benefits required by state workers' compensation laws.
- Benefits include medical care, disability income, rehabilitation, and death benefits.
- Coverage is 'no-fault' for work-related injuries.
- The listed states define the scope of coverage.
Memory trick: Part One is for the 'Worker's' direct benefits, Two for the 'Employer's' broader liability.