WHEN DO I NEED TO BUY A WORKMEN COMPENSATION POLICY?

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newznew (Exclusive) : Injury, illness, disability, job loss, have been the risks, workers in any organization, factory or other business establishments have been exposed to. Earlier, any such incident will result in strikes, shutdown, and dispute between the employer and the workers. The majority of these disputes were due to the following two factors:

  1. Compensation Amount &
  2. Cause of injury

The need to establish specific rules and accountability increased with the industrialization of the country, and finally, the rules were codified under the Workmen Compensation Act, 1923, for the first time. It has been amended time and again to include the changes in the work environment and laws as well.

The Workmen’s Compensation Act

The Workmen’s Compensation Act, currently known as “The Employees Compensation (Amendment) Bill” was first passed in 1923, and is one of the earliest workmen welfare and social security law enacted in India. It recognizes the fact that the employee needs to be compensated if he is a victim of an accident or occupational diseases during employment.

In simple words, this Act provides for the compensation of the employee or his dependents, in case he dies or suffers disablement (partial and complete) due to an accident during the employment.

Who is Covered by the Act?

The Workmen’s Compensation Act applies to the whole of India. It applies to the following types of workers and organisations:

  • The transport businesses including railways,
  • All the factories that are involved in the process of production, alteration, repairs, transportation, and sales of any articles
  • Mining companies, docks, construction companies
  • Fire brigades, plantations, oil fields
  • The workers of the newspaper companies, drivers, and cleaners, etc.
  • Workers employed for a motor vehicle operation.
  • The workers of the Indian companies working abroad
  • The person responsible for the spraying and dusting of insecticides and pesticides on the crops
  • The workers engaged in mechanized harvesting and thrashing, horticulture operations and other mechanical jobs.

Who is Not Covered?

This Act does not apply to the workmen that are covered by the rules of the Employee’s State Insurance Act, 1948.

Why there is a need for Workmen’s Compensation Act?

It is every employer’s responsibility to provide a safe working environment to all his employees. In case anything happens to the employee due to unsafe working conditions, then an employer is held responsible. So, it becomes essential that an organization provides a healthy and secure working conditions to the employees.

Nevertheless, the possibilities of an accident cannot be ruled out irrespective of the precautions are taken. Still, there are so many accidents are occurring in the workplaces. If any accident occurs at your workplace and that results in bodily injury or death, then the employer need to compensate the employee or dependents for their loss.

When Should You Buy a Workmen’s Compensation Policy?

The quick answer would be, as soon as your organisation employs anyone covered by the workmen compensation act. Detailed conditions can be as follows:

  • When you employ contractual workers not covered by a group health policy
  • When the employee/worker is not covered by the ESI.
  • When you employ any other worker categorised as a workman under the Act.

Nowadays, workmen compensation policies not only cover employer’s liabilities under WC Act but also under:

  • Fatal Accidents Act 1855
  • Common Law

Workmen’s compensation plan helps you in paying out all the sums that you are legally bound to pay to any worker under the laws provided under this Act. It also provides coverages for the cost of any expenses incurred by the insured in connection to defend the claim in the court.

How to Buy the Workmen Compensation Policy?

While it is up to you to decide whether you should purchase the plan or retain the risks, it’s better to buy the workmen compensation policy if you employ more than five such workers. However, for the best coverage, you’d like to compare various plans from different insurers. For this purpose, you can connect with online insurance advisors like SecureNow. It’ll not only make your buying process easier but also quicker. Policy management should also be easy with the help of 24×7 customer support and claim assistance.