Market insight from year-end 2020 SFCRs: Sample of life insurers based in Luxembourg
Gross written premiums in our sample of Luxembourg-based life insurers decreased 20% in 2020.
The COVID-19 pandemic is raising many questions regarding what is a compensable workers’ compensation (WC) claim.
WC insurance benefits are available if you are injured as a result of doing your job. These benefits will cover the cost of the medical care related to the injury, lost wages resulting from the injury, and even certain types of permanent impacts from the injury. Moreover, if you have a preexisting condition and can prove that your work aggravated that condition, that would also be compensable under workers’ compensation.
It is relatively easy to ascertain whether an injury is work-related—the injury must arise out of and in the course of doing your job. However, what if you get sick or an illness at work? Is it possible that illness or disease could be work-related, too? If the illness makes a preexisting condition worse, would that worsening also be work-related? The COVID-19 pandemic is raising many questions regarding what is a compensable workers’ compensation claim.
In some states, specific conditions are listed in the workers' compensation statutes as being “occupational diseases.” This means that the disease is likely to have been contracted by an employee in the course of certain employment. That is, the specified disease is presumed to be a result of exposure at work to the causative agent.
Pneumoconiosis, asbestosis, and berylliosis are common examples of work-related occupational diseases. Firefighters and police officers who contract cardiovascular or pulmonary diseases are also examples of workers who are able to bring an occupational disease claim. In the case of occupational diseases, there is typically a rebuttable presumption that the occupational disease is work-related because of the historical prevalence of the causative agent in the work environment. In addition to specified occupational diseases, other diseases can also be considered “occupational” if they are shown to be work-related. Ohio, for example, refers to chronic bronchitis and emphysema as potentially compensable non-specified occupational diseases.
When one reviews lists of specified (and examples of non-specified) diseases across states, some common characteristics stand out. They seem to be incurable, chronic, or permanent in nature with lasting effects. Moreover, they seem to be closely associated with the job itself, such as respiratory conditions from fighting fires, hypertension from the inordinate stress faced by police officers, or black lung disease from working in coal mines.
It is rare- if not unheard of- for an employee to file a workers’ compensation claim because a cold was caught from a coworker. There are sound reasons for not bringing a claim for a cold or catching the flu. First, the illness must arise out of and in the course of employment (AOE/COE). For most employees, it would be difficult to prove in this case because cold viruses are so prevalent outside the work environment. Unless the employee worked in a lab studying cold viruses for a living, for example, a workers’ compensation claim for catching a cold would not be accepted (even assuming for the moment that the illness resulted in medical treatment and lost wages).
The test to establish whether a disease like COVID-19 is work-related varies across jurisdictions. In most states, the disease has to be caused by conditions characteristic of and peculiar to a particular occupation or employment, and cannot be an ordinary disease of life to which the general public was equally exposed. Generally, employees are prohibited from bringing a workers’ compensation claim for a disease that the public is exposed to as part of everyday life. Once the disease is widespread throughout the community, establishing the work-relatedness is exceedingly difficult for most people. Furthermore, the disease would have to be diagnosed by a medical professional and be attributed to contraction from work. Limited access to testing and the uncertainties of who may have the disease add to the difficulty of proving an employee contracted COVID-19 because of work. In Ohio, for example, COVID-19 is not a workers’ compensation claim unless you work in a job that poses a special hazard or risk of contracting it in the course of employment.
While most jobs are not considered at greater risk than the general public to contracting COVID-19, healthcare providers and first responders are considered higher risk in most jurisdictions. This is the case in Washington state, where its Labor and Industries Department has advised that, for a disease such as COVID-19 that is contracted incidental to the workplace or common to all employment (such as an office worker who contracts the condition from a fellow employee), a claim for exposure to and contraction of the disease will be denied. Claims for workers’ compensation benefits from healthcare providers and first responders working with COVID-19 may be allowed, though. When filing the claim, it is still likely that the healthcare provider will need to provide some type of medical evidence of contracting COVID-19 and secondly some type of medical opinion documenting that the disease came from work (causal relationship).
In an effort to make sure high-risk occupations are able to file for workers’ compensation benefits, some states have implied that healthcare workers and first responders treating COVID-19 patients would presumptively meet the work-related test. Alaska, for instance, on March 22 introduced SB241, which would give healthcare providers and first responders the presumption for workers' compensation compensability if they contract COVID-19. The bill states, “an employee who contracts the novel coronavirus disease (COVID-19) is conclusively presumed to have contracted an occupational disease arising out of and in the course of employment (if the worker) is employed as a firefighter, emergency medical technician, paramedic, peace officer, or health care provider; is exposed to COVID-19 in the course of employment; and receives a COVID-19 diagnosis.” There are similar presumption bills pending in Louisiana, Massachusetts, and Minnesota.
As COVID-19 continues to spread across the United States, we anticipate that other states will continue to evaluate laws and make changes for claims specific to COVID-19. To the extent state workers’ compensation laws do not allow for a COVID-19 work-related claim, they will likely adopt handling and compensability determinations that are similar to other allowable occupational diseases for healthcare professionals and first responders. As an example, last week the governor of North Dakota signed an executive order to extend WC coverage to first responders and healthcare providers who contract COVID-19 on the job. Prior to this order, it was likely claims would not have been covered because diseases to which the general public outside of employment are exposed are specifically excluded from workers’ compensation coverage in North Dakota.
Employees who contract COVID-19 at an industry conference may be able to bring a workers’ compensation claim depending upon the jurisdiction as well as the facts specific to the conference or event itself. Generally, the following criteria would be considered:
This does not mean that the claim will be accepted as being work-related or that the workers’ compensation laws will provide benefits, but rather that the claim will be reviewed for compensability. However, workers’ compensation claims are more likely to be filed in circumstances where an employee is mandated to be at work in an environment where many people are interacting in close quarters with known exposure (e.g., one or more employees have a positive COVID-19 test result and are symptomatic).
Even if an employee could prove that COVID-19 was contracted while in the course of employment, in order to receive workers’ compensation benefits, the employee would also have to document that medical expenses, lost wages, and/or permanent impairment were incurred. For many illnesses (such as in the common cold example discussed previously), and as with the early indications for most people who contract COVID-19, they do not have large medical expenses, lost wages, or indications of permanent impairment. Many people are treated minimally for common ailments (if at all) and lose little or no time from work. With COVID-19, although most cases require minimal treatment, there are severe cases that result in hospitalizations and could result in death.
If there is a covered COVID-19 workers’ compensation claim, the time off work to recover from the disease, survivor benefits (if applicable for fatalities), and any related medical treatment costs are paid. Workers’ compensation does not cover wage loss due to an economic slowdown because this is not “related to the physical injury” and thus not compensable under workers’ compensation. Similarly, the loss of one’s job due to layoffs related to COVID-19 is caused by an economic event, not because of the employee’s inability to work due to illness.
Determining whether COVID-19 is covered under workers’ compensation is evolving daily and dependent on jurisdiction. While some jurisdictions and professions (healthcare providers and first responders) are more likely to have accepted workers’ compensation claims for benefits, determining whether a claim is worth filing will depend on the severity of the illness and whether the individual loses any wages. In many situations, successfully attempting the hurdle of the “work-related” barrier to bring a workers’ compensation claim for COVID-19 may not be worth the size of the monetary benefit received.