Make sure you keep your insurance payments up to date. If you let your policy lapse and an employee files a claim, you open up yourself to a negligence lawsuit.
The case: After injuring his back on the job, a warehouse worker found out that the firm's workers' comp policy had lapsed. The employee handbook said all employees would be provided workers' comp insurance. He sued for negligence, breach of contract and a violation of state insurance code. A federal appeals court let the case go to trial. (Adams v. Reynolds Tile and Flooring Inc., No. 14-03-00263-CV, Texas Ct App, 2003)
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