What type of insurance provides benefits to employees for job-related injuries or illnesses?

The type of insurance that provides employees benefits for job-related injuries or illnesses is workers' compensation.

Workers’ compensation, often shortened to workers’ comp, generally provides medical care and partial wage replacement when an employee is hurt or becomes ill because of work. Benefits can also include payments for lasting impairment and support for dependents when a worker dies from a job-related incident. The system is usually designed to operate without requiring the employee to prove employer negligence.

Its central idea is a legal trade-off called the compensation bargain. Workers receive assured, limited benefits through an administrative system, while employers gain protection from many negligence lawsuits. Rules vary widely by jurisdiction, including which workers are covered, how claims are evaluated, and whether an employer may self-insure.

The modern model is often traced to Prussia’s Workers’ Accident Insurance law of 1884, introduced under Chancellor Otto von Bismarck. In the United States, state programs expanded during the early twentieth century, and every state had enacted a workers’ compensation program by 1949.

Health insurance may pay for unrelated medical treatment, while disability insurance usually replaces income outside the narrower work-injury system. Workers’ compensation is specifically tied to employment.