Texas All Lines Adjuster Practice Test

Which group is primarily responsible for purchasing Workers Compensation insurance?

1. Self-employed individuals

2. Corporate entities

3. Nonprofits

4. Individual workers

The correct answer is: Corporate entities

The primary responsibility for purchasing Workers Compensation insurance lies with corporate entities. This is because businesses, especially those with employees, are mandated by law in most jurisdictions, including Texas, to provide Workers Compensation coverage to protect their workers in the event of work-related injuries or illnesses. Corporate entities must comply with these legal requirements to avoid penalties and ensure that their employees have access to necessary medical care and compensation for lost wages if an accident occurs on the job. While self-employed individuals may choose to obtain Workers Compensation coverage for themselves, it is not a requirement. Nonprofits also may have specific obligations based on their employment status and whether they have paid employees. Individual workers do not purchase this insurance; instead, it is the employer's responsibility to secure the coverage. Thus, corporate entities are the main group responsible for purchasing Workers Compensation insurance due to their employee obligations.