Chapter § 5.14

JurisdictionNew York

[5.14] What does workers' compensation insurance cover?

When employers buy workers' compensation insurance, the carrier is assuming the employer's statutory obligation to pay medical, indemnity, and death benefits under the law, including the following: (i) medical services; (ii) temporary disability payments to the employee to help replace lost wages; (iii) permanent disability payments to the employee to compensate for permanent effects of a workplace accident or illness; (iv) a death benefit for the employee's survivors in the event of a fatal injury; and (v) legal representation for the employer by the insurance carrier.

When an employee's on-the-job injury or disease is eligible for workers' compensation coverage, that coverage is the injured or sick employee's sole remedy, and the employee cannot sue the employer for other damages.

With the rare exceptions noted in § 5.15 below, the employer cannot be sued for civil damages arising from the injury or disease suffered by the employee. This is an important protection for both employees and employers: the employee is assured of compensation for his or her lost income and medical expense; and the employer is assured that it will not be sued in court for huge damages. WCL § 11 provides as follows:

The liability of an employer . . . shall be exclusive and in place of any other liability whatsoever, to such employee, his or her personal representatives, spouse, parents, dependents, distributees, or any person otherwise entitled to recover damages, contribution or indemnity, at common law or otherwise, on account of such injury or death.

This "exclusivity rule" has been stated by the Court of Appeals as follows:

It is well recognized that the compensation statute was designed to provide a swift and sure source of benefits to the injured employee or to the dependents of the deceased employee. The price for these secure benefits is the loss of the common-law tort action in which greater

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