The Workmen’s Compensation Act offers compensation to workers and their dependents in case of injury or accident that may arise out of and in the course of employment resulting in disability or death. It helps an employer to cover the legal liabilities, which may arise when one of its workers meets with an accident at the job place. Besides, it protects the employer from incurring heavy financial obligations. The other name for it is Employer’s Liability Insurance. The policy also provides compensation awarded to employees as decided by the worker courts.
Hence, the policy benefits both the employer and employee by providing compensation and also covering the liability of the employer towards employees under the common law.
Inclusions of the worker compensation policy
The worker’s compensation covers the following events
- Permanent total disablement
- Permanent partial disablement
- Temporary disablement
- Legal costs incurred if any
All people employed as per the Schedule II of the Act are provided coverage under this policy. Workers in mines, factories, construction sites, and various other hazardous occupations are also covered by the act.
A 30-year old Rajiv Shukla lost his right hand after his glove caught under the fast-moving machine in a manufacturing unit where he was working. Due to the accident, he permanently lost his one hand and source of income as well. Being the eldest in the family of three, including wife, daughter and father, the family’s future was in the dark. The case went to the worker courts that decided that compensation was due. The owner of the manufacturing unit had to compensate the victim. The owner had bought a workmen’s compensation policy and this accident was covered under the Workmen’s Compensation Act. The insurance policy coverage provided for the compensation benefit. Though family’s loss is impossible to compensate for but the insurance policy helps in curtailing the financial impact. In the case of Rajiv, the family got the compensation which helped in covering the loss of income.
Hence, we first need to understand the workmen’s compensation policy and its benefits and then buy a suitable policy. The financial impact of not choosing this insurance can be severe. That’s why you must take expert advice when buying it.