What do "indemnity benefits" refer to in workers' compensation?

Indemnity benefits in workers' compensation refer specifically to compensation provided for lost wages due to a work-related injury. These benefits are designed to replace a portion of the income an employee would have earned had they not been unable to work because of their injury. The intention is to financially support the injured worker during their recovery period by compensating for the lost earning capacity.

This is in contrast to other benefits that might be available under workers' compensation systems. For instance, compensation for medical expenses, while crucial, falls into the realm of medical benefits rather than indemnity benefits. Similarly, benefits for retraining after an injury would typically be classified as vocational rehabilitation benefits, and payments for permanent impairment are usually associated with specific awards for the lasting effects of the injury rather than for wage replacement. Therefore, understanding that indemnity benefits specifically address lost wages is key to differentiating them from other types of compensation within the workers' compensation framework.