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Illinois workers’ compensation doesn’t end if employer goes bankrupt

Written by: Michael J. Helfand

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Posted over 2 years ago. Applies to Illinois, 1 helpful vote, 0 comments

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In Illinois, workers’ compensation benefits continue even if your employer is bankrupt

Most employers purchase workers’ compensation insurance to cover their employees. They are required by law to do so. When a worker is hurt on the job, it’s the insurance company that pays benefits, including medical bills and lost wages. So if the employer files for bankruptcy, the insurance company must still pay. It’s possible that the bankruptcy filing may cause a delay in receiving benefits, but your benefits will not be terminated.

Even if your employer is “self insured” your benefits will continue

Some employers have the option of being self-insured, meaning that they have the resources to pay workers’ comp benefits and deal with injury claims in-house. Even if your employer is in this category, bankruptcy will not end your benefits. Illinois has something called the Illinois Insurance Guarantee Fund to pay benefits if a self-insured employer shuts down. The fund also is available in case an insurance company goes out of business. Again, there may be a delay involved, but your benefits are safe.

Reminder: Don’t believe everything your employer or their insurer tells you

Bankruptcy is one of the situations where you hear a lot of people guessing at what will happen. If someone tells you that your benefits will be terminated, don’t just believe them. Ask an attorney. The employer and their insurance company probably will not look out for you. A good attorney will.

Additional Resources

If you need help getting benefits or have questions about your eligibility for workers’ compensation in Illinois, you can ask us. We are a group of attorneys who help injured workers. We’ll try our best to answer any questions you have, and if we think you need an attorney we’ll refer you to someone we know personally.

Illinois workers’ compensation attorneys

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