What Is Workers’ Comp Insurance and How Does It Work in Houston?

In Houston, workers’ compensation provides important benefits for employees who are injured or become ill due to their job duties. However, not all employers are required to carry workers’ compensation insurance, and some may opt out of the system if they meet certain requirements.

About 28% of private employers in Texas do not carry workers’ compensation insurance. 

In this article, we’ll explore the workers’ compensation system in Houston and what employees and employers need to know to ensure that they are protected in the event of a workplace injury or illness.

What Is Workers’ Comp Insurance?

Workers’ comp insurance is a type of insurance that covers related costs for any employee who gets injured or contracts an illness while working. A workers’ comp policy is designed to provide financial aid to people who are so injured that they need to take time off work. 

Things covered by a workers’ comp policy include:

  • Medical bills
  • Lost wages
  • Rehabilitation treatment bills
  • Temporary or permanent disability benefits

Workers’ comp is in place to protect both employers and employees from the financial costs of sustaining an injury. 

How Does Workers’ Comp Work in Houston?

Workers’ compensation in Houston operates under the Texas Workers’ Compensation Act

Most employers in Texas are required to carry workers’ compensation insurance. Some employers may opt out of the system if they meet certain requirements.

Employees who are injured or become ill while performing their job duties are eligible for workers’ compensation benefits. This includes both full-time and part-time workers.

Workers’ compensation benefits in Houston typically cover medical expenses and lost wages. They can also claim compensation for permanent disabilities. In Texas, there is a cap on the number of benefits that an injured worker can receive.

Requirements for Opting Out

As stated above, certain employers are allowed to opt out of the state’s workers’ compensation system if they meet specific requirements. Let’s take a look at some of these conditions for opting out. 

Private Employers Only

Only private employers can opt out of the workers’ compensation system.

Public employers are not eligible to opt-out. So if you work for a government or state agency, you’re legally required to be covered by workers’ comp. 

Many private employers in Texas have decided to opt out of having Workers’ Comp. If you get injured at work, you might need to contact a personal injury lawyer to help you get the compensation you deserve. 

Notice and Disclosure

Employers who opt out of workers’ compensation must provide written notice to their employees informing them that they do not carry workers’ compensation insurance.

The notice must also provide information about alternative coverage that is available to employees.


Employers who opt out of workers’ compensation must obtain certification from the Texas Department of Insurance.

The certification must show that their alternative coverage meets certain requirements. Companies must provide benefits that are equal to or greater than a workers’ comp policy.

Find a Personal Injury Lawyer Today

Workers’ comp insurance is there to protect employees who find themselves injured at work. It’s a good thing, but state laws allow a lot of private employers to opt out of carrying this kind of insurance. 

If you’ve recently been injured at work and you’re unhappy with your compensation, you could benefit from contacting a personal injury lawyer. Speak to us today to see how we can help you. 


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