Also known as: Workmen’s Compensation Policy
Cover for employer liability arising from workplace injury, disability or death.
Workmen’s Compensation Insurance covers an employer’s statutory liability under the Employees Compensation Act 1923 for injury, occupational disease or death arising out of and in the course of employment. Unlike most commercial covers, this one is driven by legal obligation rather than commercial choice. Liability under the Act is strict — it applies regardless of whether the employer was negligent.
Every employer engaging workers covered by the Employees Compensation Act. Exposure is highest in construction, manufacturing, logistics, mining and any operation involving machinery or physical labour. Contractors and sub-contractor employees are a frequent gap — principal employers can find themselves liable for workers they did not directly engage.
Premium is calculated on the annual wage roll of covered employees, with rates varying by occupational risk category. Accurate wage declaration matters: under-declaration reduces premium but can result in proportionate claim settlement. Wage rolls should be reviewed at renewal rather than carried forward.
The difference between a policy that responds and one that disappoints usually sits in details that are easy to overlook at purchase.
Not sure which combination fits your business?
Speak to an AdviserThe liability under the Employees Compensation Act is statutory. Insurance is the standard means of meeting it, and is contractually required in most industrial and construction settings.
Only if they are declared. Principal employers can carry liability for contractor workers, which makes this a common and serious gap.
Under a formula in the Act based on monthly wages, age and the nature of the injury. It is not discretionary.
ESI is a statutory social security scheme with its own contribution structure and wage ceiling. Workmen’s Compensation covers employer liability for those outside ESI or beyond its scope. Many employers need both.
Generally only where travel is in the course of employment. Ordinary commuting is usually excluded, though the position depends on the facts.
The insurer may settle claims proportionally, in the same way the average clause operates on property policies.