ABSTRACT
This chapter explains the fundamental principle of liability without fault on which workers' compensation is based. State workers' compensation laws provide cash benefits, medical care, and rehabilitation services to workers who are disabled from job-related accidents or occupational disease, and death benefits to the survivors of workers killed on the job. The chapter reviews the economic and legal theories that justify the existence of workers' compensation laws. The occupational risk theory is based on the premise that each industry should bear the costs of its own occupational disabilities as a cost of production, and that the costs of job-related injuries or disease should, therefore, be reflected in product prices. The chapter describes the major objectives of workers' compensation laws and the basic characteristics of state workers' compensation laws, including covered occupations, eligibility requirements, types of benefits and financing. It illustrates the current problems and issues in workers' compensation insurance.
