With a climate that allows construction activities year-round, it’s no surprise that California leads in workers’ compensation claims. Orange County alone contributed 51,976 cases in 2022 — a 3.4% rate of injury cases per 100 employees. These are not small numbers. Injuries happen, and businesses need to be prepared. Workers’ comp insurance for Orange County general contractors is a business expense like any other, but it’s minuscule compared to the cost of not having it, especially in California.
Orange County Construction Risks
General contractors in Orange County navigate a landscape fraught with risks, and recent data reveals that certain professions within the industry face higher risk factors. According to a comprehensive contractor’s risk report by AmTrust, plumbers accounted for 28% of all workers’ compensation claims, while electricians made up 19%. These skilled trades are particularly susceptible to workplace injuries, with other construction trades bulking up the rest of the pie.
It’s not only the field of work that creates a risk factor. Newer companies and employees with less experience tend to have more claims across the board. A staggering 75% of workers’ compensation claims paid out in the sector are filed by workers for construction contractors in business less than four years. Slicing the data another way reveals that employees with less than one year on the job pose the most significant risk, representing 33% of claims.
While risk factors may decline for seasoned businesses with veteran workers, they never drop to zero. Workplace injuries happen, and the liability for businesses is substantial. The financial implications for businesses are substantial, making it imperative for general contractors to address these risks head-on.
An Essential Financial Safeguard
If your California business operates without workers’ compensation insurance, you expose yourself to various legal and financial risks. When an employee is injured while on the job, the employer may be liable for:
- Medical expenses: Coverage for medical treatment, doctor visits, hospital stays, surgeries, and medications related to a work-related injury or illness
- Temporary disability benefits: Replacement of a portion of the injured worker’s lost wages during the recovery period when they are temporarily unable to work
- Permanent disability benefits: Compensation for permanent impairments resulting from a work-related injury or illness that may affect the worker’s ability to perform their job
- Vocational rehabilitation: Assistance and support for the injured worker to re-enter the workforce through vocational training or job placement services if they cannot return to the previous job
- Death benefits: Financial support for dependents of a worker who dies as a result of a work-related injury or illness, including funeral expenses
- Supplemental job displacement benefits: Paying for retraining or skill enhancement if an injured worker cannot return to the previous job due to permanent disability
- Legal coverage: Costs associated with being sued by employees for workplace injuries
- Coverage for occupational diseases: Injuries or illnesses that develop over time due to work conditions, such as repetitive stress injuries or exposure to harmful substances.
- Travel expenses: Reimbursement for necessary travel expenses incurred for medical treatments related to the work injury
- Other related costs: Additional benefits for specific circumstances, such as home healthcare, interpreter services, or job modifications to accommodate disabilities.
Workers’ compensation may provide coverage for these different scenarios, along with the backing of insurance claim professionals skilled in the claims process and negotiating claims settlements.
Workers’ Compensation: It’s the Law in Orange County
Workers’ comp insurance is mandatory for all California businesses with even one employee. A common misconception is that companies can avoid the requirement for workers’ comp by using independent contractors. However, “independent contractors” must meet specific guidelines and are often misclassified. Misclassifying an “employee” as an “independent contractor” doesn’t remove the financial burden in the case of a covered event.
Ultimately, these rules and laws are in place to protect people. Construction jobs are inherently dangerous, and because they shoulder the financial burden of workplace incidents, companies are incentivized to create safer work environments and processes.
Preventing Workplace Injuries: A Proactive Approach
The great news is that as a company, you’re in control of preventing workplace injuries and lowering your cost of workers’ comp insurance — and you’re not in this alone. There are professionals to help you navigate the process.
To mitigate the risks associated with workplace injuries, general contractors must adopt a proactive stance. Identifying common causes of injuries, implementing comprehensive employee training programs, enforcing safety protocols on job sites, and fostering a safety culture is paramount. Newer companies need strategic measures to minimize risks during the critical early years. Investing in safety not only protects employees but also pays off in long-term cost savings.
Beyond providing a safer and healthier work environment, being adequately insured can increase the types of jobs you can bid on. Large Orange County projects with opportunities for significant profits and portfolio experience expect contractors to have solid business operations. When you can demonstrate that your team and operations focus on safety, policy, and process, you show prospects you belong among the top-tier candidates.
Let Us Help You Navigate the Process
At Western Republic Insurance Services, we understand the unique challenges general contractors face in Orange County. Our workers’ compensation solutions are designed to provide optimal protection for your business and employees.
Don’t wait until an incident occurs; take a proactive step in securing the future of your workforce. Contact us today to discuss your workers’ compensation needs and ensure a safer, more secure work environment for your team.
About Western Republic
Locally owned and operated since 2009, Gabe Stubin of Western Republic Insurance Services has delivered quality insurance solutions to individuals in Huntington Beach, California, for over 17 years. Specializing in Commercial Business insurance coverage, our team of knowledgeable insurance professionals is committed to helping you find a policy that fits your needs. We focus on providing individualized attention and quality customer service to create an experience that’s difficult to find in today’s market. At Western Republic Insurance Services, we’ll work with you to ensure that you and those you care about most are protected.