Workers’ compensation and disability insurance both provide monetary payments to employees who suffer injuries or illnesses, but they serve different functions.
The primary difference between both of these types of insurance is that workers’ compensation pays for work-related injuries. Employers are required to purchase workers’ compensation insurance to pay for incidents that occur on the job. If an employee gets injured on the job, the employer pays for the medical bills and lost wages of the employee. Generally, if the employee is collecting under workers’ compensation, they don’t have a permanent disability but rather a temporary issue.
Disability insurance, on the other hand, pays for a portion of the worker’s earnings if he or she is unable to perform job duties due to an illness or injury. An employee pays an insurance premium toward disability insurance through an employee-sponsored benefit plan.
When Employers Refuse to Pay
If your employer or their insurance company is refusing to pay workers’ compensation, the state can provide you with disability benefits until the dispute is resolved and then the state will ask for a refund if you are successful in your workers’ compensation case.
When Temporary Becomes Permanent
If a temporary injury or condition caused at work becomes permanent, then you may be entitled to permanent disability benefits rather than workers’ compensation. In this case, keep in mind that state disability benefits are only payable for 52 weeks maximum.
Workers’ compensation and disability insurance have key differences, but neither generally pay for self-inflicted or intentional injuries.