Why Workman Compensation Insurance Policy is Essential ?

Workmen’s compensation policy is an insurance policy that offers financial assistance to employees in case of an accident at the workplace. It provides monetary support to the employees if they suffer from a disability, injury, or death resulting from workplace accidents. The employer has a legal obligation to provide financial support to the employees in the case of any unfortunate accidents at the workplace as per the Workmen Compensation Act 1923.

WC insurance policy is a financial provision that helps employees and their families, allowing them to manage difficult situations swiftly while creating a safer work environment.

The rules of the Workmen’s Compensation Act ensure that the employee's rights are maintained if they face any of the following:

• Workplace injury leading to partial or total disability.

• Workplace accidents leading to death.

• Injury to the employee while at work.

• Professional illnesses that are mentioned under the Workmen Compensation Act.

Since employees are the backbone of a business organisation, their health and safety are of utmost importance. Employees working in high-risk environments may experience illnesses or meet with accidents. Compensation is, thus, necessary to provide financial assistance.

The following are the reasons why workmen's compensation is important:

Offers Comprehensive Protection to Employees

A workmen's compensation policy offers comprehensive financial support to the employee. When the work environment involves risk to the workmen's health, the policy protects them by providing financial assistance in case of injury, illness, death, disability, etc. Therefore, it shields the employees and ensures they receive the necessary help under all circumstances.

It is Compulsory As Per the Laws

An employer must compensate employees as per the Workmen's Compensation Act if they suffer from injury, death, or disability at the workplace. The workmen's compensation insurance policy assists the employer in meeting his legal obligation towards the employees without stressing the company's finances.

Offers Occupational Ailments Coverage to the Employees

Some work environments may cause the employee to suffer from occupational ailment or disease, which may be fatal at times. Due to workplace conditions, an employee may have asthma, respiratory problems, bronchitis, skin conditions, etc. The workmen’s compensation policy ensures the employee gets adequate financial coverage to treat the occupational disease.

Protects the Employer and the Employee

A WC insurance policy is tremendously essential as it protects the interests of the employer and the employee. In the presence of a compensation policy, the employer can bear the added cost of compensation without disrupting the organisation’s finances.

On the other hand, the employee receives fair financial compensation for disability, injury, etc., enabling him to meet the expenses even while he is unable to work.

Enhances Workplace Security

Another reason why a workmen’s compensation policy is essential is that it enhances the security of the workplace. The presence of workmen’s compensation instils a feeling of safety and security among the employees.

Enhances Company Reputation

One of the benefits of workmen’s compensation policy is that it enhances the company’s reputation in the industry. It builds brand value for the organisation as the company is not only focused on profits but is thoughtful about its employees, too.

Offers Legal Protection

Investing in a workmen’s compensation insurance policy safeguards the organisation from any legal suits in the future. A WC policy online proves that the organisation has fulfilled its legal obligation. Therefore, no legal action can be taken against it.

Helps to Manage the Finances

Another benefit of workmen’s compensation is that it enables the organisation to manage its finances well. In case of an accident, injury or death, the company may face heavy financial costs. However, investing in a WC insurance policy allows the organisation to be prepared for future expenses that may arise due to workplace accidents.

Attracts Good Talent

As mentioned above, investing in workmen’s compensation insurance enhances the company’s reputation. A good reputation helps the company hire talented and professional individuals who can take the company to greater heights.

Helps to Comply with Regulations

It is mandatory for businesses operating in the specified industries (manufacturing, mining, transport, factories, construction, etc.) to have a workmen's compensation policy. Investing in WC insurance allows the organisation to comply with the regulations and fulfil their obligations.

Assists the Employees in Times of Need

With the help of a workmen’s compensation insurance policy, employees of an organisation receive the desired financial support in times of difficulty. Workplace injury or accident can lead to loss of wages.

However, workmen’s compensation insurance supports the employees in times of difficulty by covering medical expenses and rehabilitation costs and providing for lost wages as per the terms of the policy.

Before buying a WC policy online, one must be well aware of the inclusions and exclusions. The inclusions and exclusions allow you to understand the scope of the policy better.

Inclusions of Workmen Compensation Insurance Policy

• Temporary disability or death

• Partial or total disability (permanent)

• Temporary disability

• Death

• Injuries sustained due to workplace accidents during employment

• Injuries sustained as a result of ailment or disease occurring due to workplace conditions.

Exclusions of Workmen Compensation Insurance Policy

The occurrence of any of the following events does not give rise to a liability on the part of the employer to compensate the employee in case he sustains any injury, disability or death.

• Injuries, deaths or disabilities to employees due to war, invasion, attacks, etc., which are not the fault of an employer.

• Deaths or injuries occurring due to terrorist attacks on the work premises.

• Self-harm or suicide attempt made by the employee.

• Injuries suffered by an employee at the work premises while he was under the influence of drugs, alcohol, etc.

• Any injury suffered outside the place of work unless the employee was present there to fulfil his duties at the direction of the authorised official or employer.

• Any interest or penalty imposed on the employee under any law

• Injury sustained by a person hired by a contractor or sub-contractor of the employee unless he is specifically covered under the policy.

• Injury or disability suffered by a person who is not covered under the insurance or is outside the insured’s business.

• An amount that the insured could have recovered from a third party in case the workmen’s insurance was not present.

Commercial insurance has become increasingly critical as it safeguards the business from suffering losses due to unforeseen events. Small and medium businesses must make a wise decision when buying SME insurance.

You can rely on the most reputed insurance providers, such as TATA AIG, for an SME insurance policy. TATA AIG offers the best commercial insurance with affordable premiums that suit the needs of various businesses. We also offer a high claim settlement ratio and swift customer services to support you.

With our workmen compensation cover, you can compensate the employees in case of partial, total or permanent disabilities resulting from workplace accidents. To enhance the scope of protection, we also offer add-ons such as subcontractors cover, medical extension and terrorism cover, which you may include to suit your business needs.

Explore our official website to find out more about our business insurance plans, the buying process, etc.

What documents are required to claim workmen's compensation policy?

The following documents are required:

• Claim form

• Compensation records

• Medical bills

• Medical certificate related to disablement

• Memorandum of agreement between the employer and worker as per WC.

What is the meaning of temporary disablement in workmen’s compensation?

Temporary disablement means an injury caused to an employee at the workplace, which makes him temporarily incapable of working and drawing his wages.

What is permanent disability under workmen’s compensation?

A permanent disability is a disability or injury to a worker which prevents him from permanently performing any work and earning money.

Does a pre-existing condition fall under the inclusion of a workmen’s compensation insurance policy?

A pre-existing health condition is not included under the scope of workmen’s compensation. Therefore, if an employee suffers from a pre-existing health condition which worsens due to the work environment, he is not entitled to receive compensation from the employer.