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How to leverage Workmen Compensation Insurance Policy for labor injuries and disputes?

07 Apr 2016 |By: Team Finalaya

Workmen insurance policy

Workers Compensation is a high liability concern for any business in India; right from companies which employ large number of employees like information technology or industrial companies, to even small companies which need to necessarily pay compensation to employees injured on the job as per labor laws.

Though it may seem to be a challenge for the businesses it is definitely an advantage for the employees. It offers employees several benefits which in turns keep them more motivated to remain with the same company. This of course helps the employers as well in terms of improved performance, productivity and reduced attrition rates.

Workers Compensation in India

Workers compensation is the amount paid by an employer to an employee for any injuries they may encounter while working. It covers medical or other expenses incurred by the employee; due to work-related activities which caused the injury.

The laws for workers compensation in India is covered by the Workmen’s Compensation Act, 1923, also known as the WC Act. The WC Act is administered on a state level by the Commissioners for Workmen’s Compensation. This Act sets guidelines for employers to provide compensation for workers and their families in cases of employment-related injuries that result in death or disability.

According to the act; factors like the nature of injury, age of the injured worker and his or her average monthly wage determine the amount which eventually has to be paid to the worker. The Act sets minimum and maximum rates for workers compensation payable for death and disability. These rates have been changed numerous times since the Act was formed. The most significant change has been noted in the Workmen’s Compensation (Amendment) Act, 2000; which says that workers or family members would receive compensation amounts at greater rates; in case of death or disability due to the job.

Workmen’s Compensation Insurance Policy

Several insurance companies offer policies to help all types of businesses in India to handle worker compensation. An employer to protect themselves from their liability towards workers compensation can opt for one of the best matched Workmen’s compensation insurance policy; amongst the many available in the market.

Insurance Companies in India like SecureNow, a leading insurance broking firm offers companies accurate coverage details after ascertaining the company’s background, workers details and other details. Premium is determined by employee wages and may also be referred to as employer’s liability insurance policies as they cover the employer against liabilities towards workers compensation in India.

Using the Insurance Policy effectively

It can be costly at times to get workers compensation insurance for many employers; at times leading to a significant increase in costs of the business. However it is essential considering it covers the employer from future liability; and reduces considerable risk of the employer.

Here are few things employers can do to make the most of their insurance policy.

Review the Audit

An employer can lose of money due to error made by insurance companies; hence it is imperative that the employer verifies all audits and reviews all the premium calculations; in order to avoid over payments. Before getting an insurance policy the employer can even consult independent consultants to take the right decision regarding the policy.

Handling Labor Injuries and disputes

Workers compensation claims do occur; and when the employee gets injured the employer needs to ensure that they pay the compensation to their worker; by providing the required medical and rehabilitation services to get them back to work as soon as possible.

There are various steps an employer can take to help keep their workers compensation claims under control and may be the single most vital step would be to stay involved in the insurance process. The employer during such an event can consider-

  • Reporting claims to the insurance company as fast as possible
  • Try to close the claim as soon as possible by working closely with the company’s insurance adjuster
  • Working towards getting the injured employee back in good health and at work as quickly as possible

Getting the right policy

Various insurance agents can provide a great variety of knowledge and expertise; however it is important to select the right agent or company which has the right knowledge, experience and understanding of the workers compensation process.

It is necessary to get workers compensation coverage from an insurance company that understands employer’s type of business operation, is financially stable and committed, and will be there to provide claims services for the business when required.

An employer can keep few things in mind while choosing an insurance company and policy like-the company offers a variety of options; the advisors are well educated about the rules and regulations as set by regulatory bodies. Eventually the employer needs to select a workmen compensation insurance policy; which can help cover the business from liability in the best way possible.

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