Employer Liability Insurance Workers Comp Part B
Part A workers comp covers statutory employee benefits. Part B — employer liability — protects your business against lawsuits that fall outside the workers comp system: third-party over actions, loss of consortium claims, dual capacity suits, and more. Don't assume your WC policy fully protects you.
Lawsuit Defense Included
Third-party over, dual capacity & more
Part A vs. Part B: Understanding Workers Comp
A standard workers compensation policy contains two distinct coverage parts. Most employers focus exclusively on Part A — but Part B is equally essential to complete protection.
Statutory Benefits
Covers the no-fault, statutory benefits your state mandates for injured employees. Employees exchange their right to sue for guaranteed coverage of:
- Medical expenses — all necessary treatment
- Lost wages — temporary & permanent disability
- Vocational rehabilitation & retraining
- Death benefits & funeral expenses
- Coverage for all eligible W-2 employees
Limits set by state law — no elected limit required
Lawsuit Protection
Covers lawsuits brought against the employer for work-related injuries that fall outside the exclusive remedy protection of workers comp:
- Third-party over actions (contribution claims)
- Loss of consortium — spouse & dependent claims
- Dual capacity suits (employer as product maker)
- Consequential bodily injury to family members
- Defense costs + indemnity for covered suits
Limits elected — standard $100K/$100K/$500K; higher limits available
When Employer Liability Part B Applies
Part B coverage steps in for specific legal theories that allow injured workers or their families to pursue claims outside the workers comp exclusive remedy system.
Third-Party Over Actions
An employee injured by defective equipment sues the manufacturer. The manufacturer then sues your company for contribution — claiming your negligence contributed to the injury. Part B responds to this third-party-over lawsuit even after the employee has received WC benefits.
Loss of Consortium Claims
The spouse or dependents of a severely injured employee may sue the employer for damages — loss of companionship, household services, and consortium. These claims fall outside the workers comp statutory system and require employer liability Part B coverage.
Dual Capacity Suits
When an employer also acts in a different capacity — as a product manufacturer, property owner, or healthcare provider — an employee may sue both as an employee and as a third-party plaintiff. Dual capacity claims bypass the exclusive remedy bar of workers comp.
Consequential Bodily Injury
A family member who cares for an injured employee and suffers their own physical injury as a direct result may bring a consequential bodily injury claim. Part B covers these consequential claims that arise from the original workplace injury.
Ghost Policy & Employer Liability: Key Scenarios
Ghost policies include Part B coverage — here's how it applies in owner-operator and independent contractor contexts.
Ghost Employee Injury Lawsuit
A sole proprietor with a ghost policy is injured on a client's job site. If the client's property conditions contributed to the injury, the owner may pursue a premises liability or third-party action. Part B provides defense coverage for counter-claims.
Reclassified 1099 Worker Claims
A worker originally classified as an independent contractor is later reclassified as an employee. If injured, they may pursue a workers comp claim and separately file an employer liability suit — Part B covers the civil exposure.
Subcontractor Misclassification
An uninsured subcontractor treated as an independent contractor sues the general contractor after injury. If the GC is deemed a statutory employer, Part B provides defense and indemnity for the resulting employer liability claim.
Standard Coverage Limits
Employer liability limits are stated in three parts — all three should be considered when selecting your coverage level.
Per occurrence limit for bodily injury by accident
Per employee limit for occupational disease claims
Total policy limit for all disease claims
Higher Limits Available
Most carriers offer optional limits of $500,000/$500,000/$500,000 or $1,000,000/$1,000,000/$1,000,000. Commercial umbrella policies can provide additional limits above the underlying employer liability tower. Call CCA at 844-967-5247 to discuss the right limit structure for your risk profile.
Frequently Asked Questions
Common questions about employer liability and workers comp Part B coverage.
Secure Complete Employer Liability Protection
Don't let a third-party lawsuit or consortium claim catch you without Part B coverage. CCA structures complete workers comp programs — Part A and Part B — for businesses of all sizes.