As a business owner, one of your priorities is to increase the volume of your earnings in a fair and ethical manner. You need to protect all your assets and proceedings. For this, you need to adhere to government norms and also ascertain the welfare of your employees. Providing your employees with a workmen compensation insurance policy is an integral part of that deal. In order to optimize production and meet the rising demand, the manufacturing sectors rely upon the use of heavy-duty equipment. The workmen using such equipment are up against a certain degree of occupational hazard or risks. The comparative poverty of the workmen requires them to be protected as far as possible from any suffering caused during the course of work.
The responsibility of ensuring the proper welfare of workmen lies mainly with the employers. For workers’ welfare, the Government of India drafted the Workmen’s compensation Act in 1923. However, it has undergone several amendments since its first draft. Under the purview of the act, the workmen’s compensation policy is a legal liability that requires employers to extend coverage to their employees. Employers are liable to provide compensation to workers in case of any injury, accident, or death caused out of or during the course of employment. The premium rate of the policy is largely determined by the salary and occupation of the workmen.
Difference between accidents arising out of employment & accidents arising in the course of employment
There is a technical difference between accidents arising out of employment and arising in the course of employment. In the case of the former, the disease or injury is caused due to the risks involved with the nature of work or employment. It is for the injuries at the workplace that compensation is claimed by workers. Whereas, when a workman seeks compensation for an incident or injury caused while he or she was on duty then it is fatality arising during the course of employment
Reasons to make Workmen Compensation Policy an integral part of business
The major component of the policy is to ensure the protection and welfare of the employee or workmen. Its incorporation also provides a protective layer to the employer against expensive lawsuits and unnerving compensation cutouts.
Therefore, a workmen’s compensation insurance policy is an imperative part of your business for the following reasons:
Extends protection to the important asset of your company- the workmen or employee
Keeping workmen employed in the unit is the prime priority of employers, irrespective of the size of their business units. If your workforce is unhappy, the productivity of your business will eventually suffer. The backing of a fair compensation policy goes a long way toward achieving employee satisfaction and loyalty. These are essential for the growth and development of a business. Secondly, the policy facilitates treatment when employees get injured while on duty. Proper medical care will help in the worker’s speedy recovery and return to work.
It’s the law of the land
In order to avoid any kind of legal penalty or complication, providing a workmen compensation policy to employees is absolutely mandatory. It is in the best interest of your business and its prospects. It is the law of the land and everyone should abide by it by all means.
Protects employer against a lawsuit
The employer defines the terms of the cover when he/she offers a workmen compensation policy to its employee or workforce. This will ensure that there is no ambiguity in the contract. Moreover, the asset of the employer remains protected against any kind of lawsuit or compensation payouts.
The statutory liability of the employer covered under the policy
Table ‘A’ – Table A covers the Workmen’s Compensation Act, 1923, Fatal Accidents Act, 1855, and Common Law, It is indemnity against legal liability to all employees.
Table ‘B’ – Covers indemnity against legal liability under the Fatal Accidents Act, 1855 and Common Law. The premium is, therefore, determined for each table separately. Policy Inclusions
To put it in simple words, the workmen’s compensation insurance policy provides cover to the employee for the following circumstances:
- Permanent total disablement
- Permanent partial disablement
- Temporary disablement
Major Exclusions in Workmen Compensation Insurance :
Some major points of exclusions from the workmen’s compensation policy are as below:
- Any injury caused by accident or disease as a result of war or nuclear disaster
- Disease mentioned in Part C of the Workmen Compensation Act-1923
- Fatal or non-fatal injury caused due to the negligence (effect of alcohol or drug) of the workman
- An accident caused due to willful disregard for safety norms by the workman
- Injury or accidents resulting in a fatality or partial disablement after a period of three days.
Workmen’s compensation insurance is important for both the employer and the employee. it allows the employer to carry out its operations without the risk of any sudden financial outflows and provides financial stability. To understand the importance of providing policy coverage to employees and invest in a suitable policy for your organization. You can take the help of Securenow’s highly skilled team to let you compare insurance quotes online and select the right policy according to your needs.