Exclusive Remedy
What Does Exclusive Remedy Mean?
Exclusive remedy is a provision in a worker’s compensation policy that prevents an employee from filing a legal complaint against their employer for a work-related injury. Under this provision, the benefits received for the injury are considered the complete compensatory package for the employee.
Insuranceopedia Explains Exclusive Remedy
The prompt delivery of benefits for work-related injuries constitutes the compensation itself, which is regarded as the exclusive remedy for such injuries. In the absence of workers’ compensation insurance, injured workers can pursue compensation through the courts as an alternative. This is part of why most states require employers to carry workers’ compensation insurance, which pays for medical care and lost wages so the business avoids costly individual lawsuits.
However, even with an exclusive remedy provision in place, employees can still seek damages in court if their injury was caused by a third party or if there was intentional harm by the employer. For employers, this is one reason workers’ comp is usually purchased alongside general liability and other types of business insurance.
