Workmen compensation insurance is a product designed to insure the employer against their liability towards the workers in case of injury at the workplace. Workmen's Compensation Act 1923 provides for the payment of compensation by the employer to his employees (or their dependents in the event of fatal accidents) if personal injury is caused to them by accidents arising out of and in the course of their employment.
Nomenclature of this Act has changed to Employee’s Compensation Act,1923 with effect from 18th January,2010. In terms of this amendment, all reference to “Workmen” has been amended to “Employees”. In effect, this change brings clerical workers under the purview of the act.
Our Workmen / Employee’s Compensation policy indemnifies an employer for
- Employers legal liability to his Employees under the Indian Employee 's Compensation Act 1923and subsequent Amendments of the said Act.
- Indemnity under the Indian Fatal Accidents Act, 1855, and
- Indemnity at common Law.
In addition, the insurance company bears the costs and expenses incurred in respect of defence of claims.
Workmen Compensation (WC) Act was brought in to provide organizations and workers a medium to decide the extent of compensation owed by the employer if a worker sustains an injury at the workplace and unable to attend to his duties and earn wages for an extended time.
On one hand, the act ensured that the workers are compensated for their loss of wages and health, it limits the employer’s financial responsibility to a calculable amount on the other.
Workmen Compensation Insurance covers these liabilities of the employer as prescribed by the Workmen Compensation Act. Therefore, any workmen compensation policy should cover the following:
- Death
- Permanent total disablement
- Permanent partial disablement
- Temporary disablement
- Medical expenses incurred for injury or illness
- Replacement income costs
- Costs for retraining
- Legal costs incurred if any.
- Benefits to survivors of workers who are killed on the job
Besides the above Workers’ compensation insurance is not only limited to accidents. It also covers problems and illnesses that might develop over an extended period of time due to the same injurious activity.