Differences between unemployment and workers’ compensation insurance in the United States


Unemployment insurance and workers compensation insurance have an employee focus but are 2 very different policies from each other. Both are useful for workers and their families.

Differences between unemployment insurance and workers’ compensation

The first difference is that workers’ compensation plans are policies that insurers sell. Unemployment insurance is a combination of government programs developed with a social focus and insurance companies, in such a way as to improve compensation. This allows the payment received by the unemployed worker to reach around 50% of what his salary was.

Unemployment insurance applies exclusively when a worker is unemployed for reasons beyond his control. Compensation insurance policies operate when there is an accident or illness caused by work activities. This means that unemployment works when the worker does not have a job. Compensation insurance works exclusively at work, whether due to accident or illness.

Workers’ compensation insurance must be requested by companies when they have workers. This insurance must be purchased by all employers. Unemployment insurance from private insurers must be contracted prior to the unemployment situation. These are paid by the worker himself.

Workers’ compensation insurance premiums must be paid by the employer or business. Unemployment insurance from private insurers must be contracted prior to the unemployment situation. These will be paid by the worker himself. Most of the insurers that sell them have a period without coverage, usually during the first 6 months after the policy is issued, in such a way that it is not contracted when a layoff is known with some anticipation.

The process with the Government only begins after the unemployment situation arises.

Who can enjoy unemployment and compensation insurance

Unemployment insurance is available according to the rules of each state. Compensation fees also vary, but are mandatory for any business in most of the country.

Unemployment insurance benefits are exclusively temporary. Some of the benefits of workers’ compensation insurance can be for life in the event of total or partial disability that has permanent effects.


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