What is the primary purpose of workers' compensation insurance?

The primary purpose of workers' compensation insurance is to provide medical benefits and wage replacement to employees who are injured or become ill as a direct result of their job. This type of insurance ensures that workers receive the necessary medical treatment and compensation for lost wages while they are unable to work due to their injuries. By doing so, workers' compensation helps to protect the health and financial stability of employees, allowing them to focus on recovery without the added stress of lost income. It is a critical safety net that promotes a healthier workforce and encourages workers to report injuries and illnesses without fear of retaliation from employers.

The other options fail to capture the specific aim of workers' compensation, which is solely focused on addressing workplace injuries and illnesses rather than covering costs associated with retirement, unemployment, or tax reductions.