Worker Compensation provides insurance to cover medical care and compensation for employees who are injured in the course of employment, in exchange for mandatory relinquishment of the employee's right to sue his or her employer for the tort of negligence.

Alabama basically allows for "full coverage" of workers' compensation benefits. This means there is no statutory limitation on either the cost or time for medical care. Most states allow for coverage by the private insurance industry. Six states have an exclusive fund wherein the state is the insurance carrier, and four of those also permit self-insurance.