Workmen Compensation

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How to decide the Insurer in Workers’ Compensation?

You may follow the steps given below to arrive at the best possible insurer for your worker’s compensation policy:

  1. A Competent Insurer: With the number of private sector players growing in the industry, you have to research for an insurer which has the width of presence, financial strength, and requisite infrastructure to support the claim and operations process of workers’ compensation insurance.
  2. Understand Workers’ Compensation Act: The cover and risks differ widely depending on the industry. Broadly speaking industrial & manufacturing industries face higher value and more frequent claims. Also the workmen compensation policy premium varies for different industries. For instance, premiums for the most risky or dangerous industries, such as for firms in mining or transport, may be much higher than premiums say for an advertising firm.
  3. Look for Comprehensive Cover: The policy should cover legal liability under the Workmen Compensation Act of 1923 and subsequent amendments. Claims under the Fatal Accident Act, 1855 and common law should also be covered. The policy should include death, permanent disability, partial disability, temporary total disability, and should have the option to extend the cover for ambulance and medical expenses.
  4. Turnaround Time: In cases related to workers’ compensation, cover notes should be issued quickly upon request. Agencies and insurers should be able to accept claims 24 hours a day, via e-mail and/or a 24-hour toll-free telephone service.
  5. Consulting for Best Practices: The insurer should provide value added services like best practices in the concerned industry to avoid disaster scenarios in the future.
  6. The Claim Process Support: The insurer should have the mechanism in place for the processing of all aspects of your worker compensation claim. A single point of contact, online and offline presence are real value add for claim processing.

Case on Selecting Insurer for Workers’ Compensation Insurance

Cinderella Toys Pvt. Ltd. is a manufacturing and sales firm for children’s toys. They employ 15 permanent workers throughout the year and some 6 – 7 temporary workers for a few months in the year. The owner of Cinderella Toys, Sanjeev Aggarwal, is looking to buy workers compensation insurance policy to cover his responsibility of compensating workers for injuries or health issues sustained during the work.

He has two choices:

  1. The Insurer promises to discount the premium but will not include any critical illnesses or medical expenses incurred by workers.
  2. The insurer will charge about 15% higher but includes the liabilities under the Act as well as the costs for treatment and transportation of injured worker(s).

Also, managing the policy is easy with the second insurer as Sanjeev can pay the premium online, through their web portal and get 24×7 claim support. Both companies promise hassle-free maintenance of the policy, but since the first company does not offer online management, Sanjeev has decided to go with the second option.

How to decide the Insurer in Workers’ Compensation?

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