If a person is unfamiliar with what excess Workers Compensation is, it can be extremely beneficial to get all the information available so as to be able to make an informed decision on whether or not it is something his or her business needs. It can also help to understand that there are two types of excess Workers Compensation coverage for an owner to become familiar with. These types of coverage are called specific and aggregate.
Specific excess coverage refers to an event that occurs that ends up being a higher cost to the owner than anticipated. While the owner does end up paying a certain amount, once that amount reaches a certain point, the insurance kicks in and starts covering the losses the owner is incurring.
Aggregate excess involves limiting the amount of money that an owner pays on all claims over a certain amount of time, often agreed upon between the owner and the insurance company. The amount the owner must pay out before coverage begins may also be predetermined between the owner and the company.
Understanding what excess Workers Compensation is and what it does is an important part of deciding whether or not a business needs it. One part of understanding it is knowing that there are two types: specific excess coverage and aggregate excess coverage. Knowing this will hopefully help owners make an informed decision on what excess coverage to choose.