Michigan Residential Builders License Practice Test

What type of insurance provides additional protection for employers in case of employee injury or death on a construction site?

1. Workers' compensation insurance

2. Employers liability insurance

3. General liability insurance

4. Health insurance

The correct answer is: Employers liability insurance

The correct choice is employers liability insurance, which provides essential coverage for employers against claims made by employees for injuries or deaths that occur on the job, particularly in situations that may not be fully covered by workers' compensation insurance. While workers' compensation insurance addresses medical expenses and lost wages for employees who are injured during work, employers liability insurance steps in to protect the employer from additional legal claims that might arise if an employee believes that their injury was due to the employer's negligence. This can include situations where the employee sues for damages beyond what workers' compensation covers, such as for emotional distress or punitive damages. This type of insurance is crucial in the construction industry, where the risk of serious injuries can be high due to the nature of the work and the potentially hazardous environment of job sites. Employers liability insurance thus serves as an essential safeguard, complementing workers' compensation by covering scenarios where an employee may pursue legal action against the employer for conditions that led to their injury or death. In contrast, workers' compensation insurance provides the primary coverage for on-the-job injuries but does not cover all circumstances, which is why employers liability insurance is needed. General liability insurance, on the other hand, typically covers third-party bodily injuries and property damage but does not extend to