Free Workers Compensation Insurance Study Guide
Texas General Lines — Property & Casualty exam — Workers Compensation Insurance.
Texas is the state where workers compensation is elective for most private employers. An employer may choose to be a nonsubscriber. The law is the Texas Workers' Compensation Act, Labor Code Title 5, administered by the Division of Workers' Compensation at TDI (Lab. Code 402.001). The policy itself and premium rating are covered in the national workers compensation guide. This guide covers the Texas rules.
Subscribers and nonsubscribers
- Most private employers may decline coverage and be nonsubscribers (Lab. Code 406.002).
- A nonsubscriber's position in an employee's injury suit (406.033):
- It loses the common-law defenses of contributory negligence, assumption of risk and fellow-servant negligence.
- It may still defend on the grounds that the employee was intoxicated or meant to injure themselves.
- A nonsubscriber must notify the Division of its status (406.004, 406.005).
- Employers must tell employees about coverage (406.005):
- tell new hires whether they're covered
- post notices
- notify employees within 15 days after coverage is obtained, ends or is cancelled
- An employee of a subscriber may keep common-law rights by giving written notice within 5 days of starting work or of learning of coverage (406.034).
Exclusive remedy
- For a subscriber, workers compensation is the exclusive remedy (408.001).
- Exception: exemplary damages are still available for a death caused by the employer's intentional act or gross negligence.
- The carrier pays without regard to fault for injuries in the course and scope of employment (406.031).
- Not compensable (406.032):
- injury while intoxicated
- willful self-injury
- horseplay
- certain personal attacks
- voluntary off-duty recreation
- most acts of God
- Extraterritorial coverage applies when the employee has significant contacts with Texas or the job is principally located there (406.071).
Benefits (Lab. Code 408)
| Benefit | Texas rule |
|---|---|
| Medical | All health care reasonably required by the injury, as and when needed, from the date of injury. The employee's first doctor comes from the Division's approved list (408.021, 408.022). |
| Waiting period | No income benefits for a disability of less than 1 week. Benefits accrue from the 8th day, or from day one if the disability lasts 2 weeks or more (408.082). |
| Temporary income benefits (TIBs) | 70% of lost wages, or 75% for the first 26 weeks for workers earning under $10 an hour. They're paid until maximum medical improvement (408.101 to 408.103). |
| Maximum medical improvement | The earlier of no further material recovery, or 104 weeks after income benefits begin (401.011). |
| Impairment income benefits (IIBs) | 3 weeks for each percentage point of impairment, at 70% of the average weekly wage (408.121, 408.126). |
| Supplemental income benefits (SIBs) | Requires an impairment rating of 15% or more and earnings below 80% of the pre-injury wage (408.142). |
| Lifetime income benefits | For catastrophic injuries, such as loss of sight in both eyes or loss of both hands or feet (408.161). |
| Death | 75% of the average weekly wage. A spouse receives benefits for life or until remarriage, then 104 weeks in a lump sum (408.181, 408.183). |
| Burial | Actual reasonable cost, up to $10,000 (408.186). |
No tort damages, such as pain and suffering, are paid.
Claim deadlines
- Employee to employer: report the injury within 30 days (409.001).
- Claim with the Division: file within 1 year of the injury (409.003).
- Employer to carrier: report within 8 days after an absence of more than one day (409.005).
- Carrier: begin benefits or deny in writing within 15 days of written notice (409.021).
Guaranty protection
If a workers compensation insurer becomes insolvent, the Texas Property and Casualty Insurance Guaranty Association pays covered workers compensation claims in full (TIC 462.213).
Common exam traps
- Coverage is elective. A nonsubscriber loses contributory negligence, assumption of risk and fellow-servant defenses.
- Waiting period: 7 days, retroactive after 2 weeks.
- TIBs are 70%. MMI comes at 104 weeks at the latest.
- Employee notice: 30 days. Claim filing: 1 year. Carrier action: 15 days.
- Death benefits are 75%. Burial is capped at $10,000.
Practice Workers Compensation Insurance questions All General Lines — Property & Casualty topics
Practice questions are study aids generated for exam preparation and are not actual exam questions. Content is provided for educational purposes and is not legal advice. Verify current statutes, rules, and exam specifications with the Insurance Department and the exam administrator before relying on it.
