Texas All Lines Adjuster Practice Test

Which insurance provides coverage in case of lost wages due to a work-related injury?

1. Travel Insurance

2. Liability Insurance

3. Workers Compensation

4. Health Insurance

The correct answer is: Workers Compensation

Workers compensation is a specific type of insurance designed to provide coverage for employees who suffer injuries or illnesses that are directly related to their work duties. This form of insurance not only covers medical expenses incurred as a result of a work-related injury but also includes compensation for lost wages if the employee is unable to work due to their injury. The rationale behind workers compensation is to ensure that employees are protected financially in the event of an injury while also providing a no-fault system that protects employers from lawsuits related to those injuries. This insurance is a legal requirement in many states, including Texas, ensuring that injured workers receive necessary support promptly. In contrast, travel insurance primarily covers losses related to travel, such as trip cancellations or lost luggage, but does not provide coverage for work-related injuries. Liability insurance protects against claims resulting from injuries and damage to other people or property but does not cover the insured's own lost wages. Health insurance provides assistance for medical expenses but does not specifically cater to income loss due to work-related injuries. Thus, workers compensation is distinct in its targeted coverage for lost wages associated with work-related incidents.