Workmen Compensation

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Your choice of coverage determines the cost of insurance, referred to as the premium. The insurance regulator in India, called IRDA, makes this decision.

The following two types of covers are available under Workmen (now Employees) Compensation Insurance:

  • Table A: Indemnity against legal liability for the accident to employees under
  • Workmen’s Compensation Act 1923
  • Fatal Accident Act 1855
  • Common-Law
  • Table B: Indemnity against legal liability
  • Fatal Accident Act 1855
  • Common-Law

In the first case (Table A), you can extend the policies to include contractual workers as well. However, the premium is further dependent on various factors, such as:

  • The nature of business,
  • The number of the employee base,
  • The location of the workers,
  • Is the professional disease covered?
  • The wages before deductions of the workers (including lodging expense if provided by employer)
  • Term of the Policy (12 months or more)

Premium Ratings

  • The minimum premium in the case of household servants is Rs.10 in any other case indeed, it must be Rs.20.
  • Person with insurance covers different types of risks, like workers in electrical and mechanical departments, all under one policy.
  • Similarly, the minimum premium should be Rs. 30
  • The Insurance Information Bureau of India (IIB) regularly updates the professional tariff rates. You can check these rates, also known as the “Book Rate,” for cost details related to different types of work, businesses, and occupations.
  • Consider a maximum monthly wage of Rs. 12,000 for the calculation. For any additional wage, estimate the premium by applying 6.25% of the book rate for the occupation. However, ensure that the premium doesn’t fall below the specified minimum limits.
  • 2 per mille (thousand) per annum for workers engaged in manual labour
  • 1.2 per mille (thousand) per annum for clerical staff not engaged in manual labour
  • Medical expense (if covered) limit including the cost of an ambulance increases the premium in the following manner:

Expense per case! (Rs.)


Expense per case! (Rs.)

Premium Increase over Book Rate















Payable by the WC insurance policy

  • Covering occupational diseases requires an additional premium of 50% of the book rate. Calculate the premium per case and then multiply it by the number of employees or workers. Coverage is necessary to calculate the final premium.
  • If the average wage of the employee exceeds Rs. 50,000 per annum special tariff rates (lower than normal book rate) may apply.

See: What is covered under workmen compensation insurance policy

Case on Workmen Compensation Policy Premium

Shoumik Das is collaborating with insurance advisor to figure out the lowest premium for his company’s worker’s compensation policy.

Moreover, Shoumik is a civil contractor and employs about 70 workers and supervisors at any time for the work.

Workers’ wages can vary throughout the year, Chaitali, Shoumik’s advisor, recommends calculating the average compensation for past 12 months.

This helps understand the average liability for the insurer in case of a compensation insurance claim .

The average age of his employees is 37 years. Shoumik has not faced any major accidents involving his workers or machinery. Because of, stringent security processes implemented by him.

Shoumik has chosen the WC insurance cover from Table A for his employees. Here is the information he provides (all figures represent the daily average for the past 12 months):

  • Employees engaged in loading and as well as unloading vessels: 15 (Avg.wages past 12 months: Rs. 75,000)
  • Workers engaged in Building towers and buildings: 35 (Avg. wages past 12 months: Rs.75,000)
  • Woodworker/carpenters engaged: 10 (Avg. wages past 12 months: Rs. 80,000)
  • Agronomist (botanists or gardeners): 4(Avg. wages past 12 months: Rs. 60,000)
  • And, other employees: 6 (Avg. wages past 12 months: Rs. 100,000)

The premium quoted by the insurer to cover Shoumik’s staff for 12 months is Rs.48,595 and besides, Rs. 66,780 under Table A. Therefore, the first option does not cover professional diseases and sub-contractors.

Shoumik has the option to exclude (or reduce) medical expenses (currently included at Rs. 20,000 p.a.) under the policy. It will decrease the premium accordingly.

About The Author

Rahul Kumar 

MBA Finance

With a wealth of experience in the insurance industry, Rahul is a seasoned writer specializing in articles related to workmen compensation policies (WC policies) for SecureNow. With 12 years of experience in the field, he has acquired in-depth knowledge and expertise in workmen compensation insurance, understanding its complexities and nuances. Their insightful articles provide valuable insights into the importance of WC policies for businesses and employees alike, offering practical advice and guidance on navigating the intricacies of insurance coverage. Trust him to deliver informative and engaging content, backed by years of experience and a passion for educating readers about insurance-related topics.