West Virginia Adjusters Practice Exam

Most states require businesses to purchase workers' compensation insurance to cover their employees. Workers' comp in those states is:

1. advisory

2. compulsory

3. elective

4. optional

The correct answer is: advisory

Workers' compensation insurance is generally considered compulsory in most states. This means that businesses are legally required to obtain this insurance to cover their employees in the event of work-related injuries or illnesses. The primary goal of workers' compensation is to provide employees with a form of financial protection for medical expenses and lost wages due to on-the-job injuries without needing to establish fault. The other options suggest levels of choice or voluntary participation, which do not apply to the majority of states regarding workers' compensation coverage. Advisory implies that states may offer guidance on practices but do not mandate coverage. Elective would mean that businesses can choose whether to participate, and optional suggests that businesses are not required to obtain it at all. However, in most jurisdictions, businesses must comply with the law and secure workers' compensation insurance to protect their employees adequately.