WORKERS' COMPENSATION INSURANCE POLICY

One of your priorities as a business owner is to increase earnings moderately and ethically while protecting your assets, life and proceedings. For this, you need to comply with government regulations and ensure the welfare of your employees. The advent of industrialization brought highly advanced and complex machinery. Even though this led to our progress as a country, workers' exposure to danger also increased, despite incorporating multiple safety features. As a result of the risk of severe bodily injury, and in some cases, even death associated with hazardous working conditions, the government in 1923 passed the Workmen's Compensation Act. Under this act, workers' welfare is the responsibility of employers. If an employee is injured, stunted, or dies while at work, the employer is liable for providing compensation. It is a requirement for all businesses involved in manufacturing, trading, mining, construction, transportation, factories, plantations, and service establishments to provide risk cover to employees on the floor and office. That's where workers' compensation insurance plays a crucial role.

What is the Workmen Compensation Insurance Policy?

The Employees compensation policy/Workmen's compensation insurance plan is a commercial insurance plan that covers a company's legal responsibility for death, injury, or occupational disease resulting from workplace activities. It is governed by the Workmen's Compensation Act 1923, Fatal Accident Act 1855, and common laws. In addition, it is called Employer's Liability Insurance since it protects employers from financial responsibility. The policy also covers legal fees and compensation awarded by labour courts.

For employees-

• Covers the cost of hospitalization for an employee injured at work

• Covers for death, permanent or partial disablement at the workplace

• Serves as a financial cushion for the employee and their family in case of any adversity

For employers-

• Workers' compensation insurance protects your workers from occupational diseases. This insurance policy can be a lifesaver if your workers are exposed to hazardous substances or other risks.

• When you have workmen's compensation insurance, you can rest assured that you can financially support your employees and the organization if and when they suffer work-related injuries or death.

• This policy covers accidental death or disability cases filed with the Labour Court.

• Choosing a Workmen's or Employees' Compensation Policy demonstrates the employer's employee-caring approach, employee welfare, and adherence to statutory requirements. As a result, the company appears strong, stable, and attractive to potential employees and investors.

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What factors affect the premium?

Premiums for Workers' Compensation depend on these factors:

1. The nature of the organization and its main activities. Work is deemed relatively riskier in some situations. Mining and construction are two examples.

2. Employment Type of insured workers

3. Average compensation payable

4. The number of employees. As the number of employees increases, the premium increases.

5. Timeframe for the risk coverage. Workmen's compensation can be purchased just for the duration of a project. In the case of shorter projects, premiums are accordingly reduced.

6. Information about the client's past claims. Claims in the past may indicate that accident prevention measures are not effective.

Why choose an expert insurance broker - PrishaPolicy?

The factors impact premiums in the previous section based on the risks they cover. However, insurers may charge different premiums for the same risk. It is due to how insurers look at risks; some emphasize the frequency of claims more than the severity. Some insurers may scrutinize the seriousness of previous claims; some would have a solid understanding of manufacturing, while others may be more knowledgeable about the service industry. Premium rates fluctuate based on their claims experience. Insurers that have recently faced large Workmen's compensation claims will not want to compete aggressively. Still, new players will keep premiums low to gain market share. It is difficult for buyers to keep track of all these dynamics and, therefore, would benefit from working with an experienced intermediary like PrishaPolicy to assist them.