Which insurance coverage is necessary for a business to offer its employees legally?

Workers' Compensation Insurance is necessary for a business to legally offer coverage to its employees. In California, state law mandates that nearly all employers provide workers' compensation insurance to their employees. This insurance protects workers who suffer job-related injuries or illnesses by covering medical expenses and providing disability benefits. It also protects employers by limiting their liability in case of workplace injuries.

Having workers' compensation insurance not only fulfills legal obligations but also fosters a safer work environment, knowing that employees are protected. In situations where employees are injured on the job, workers' compensation serves as the exclusive remedy, preventing employees from suing their employers for negligence in most cases. This legal requirement is critical for business operations as it helps to mitigate potential financial loss due to work-related injuries and illnesses.