Workmen compensation insurance is a product designed to insure the employer against their liability towards the workers in case of injury at the workplace.
Workmen Compensation Act:
Workmen Compensation Act was brought in to provide organizations and workers a medium to decide the extent of compensation owed by the employer if a worker sustains an injury at the workplace and unable to attend to his duties and earn wages for an extended time.
On one hand, the act ensured that the workers are compensated for their loss of wages and health, it limits the employer’s financial responsibility to a calculable amount on the other.
Workmen compensation insurance policy covers these liabilities of the employer as prescribed by the Workmen Compensation Act. Therefore, any workmen compensation policy should cover the following:
- Death
- Permanent total disablement
- Permanent partial disablement
- Temporary disablement
- Medical care from the injury or illness
- Replacement income costs
- Costs for retraining
- Legal costs incurred if any
- Benefits to survivors of workers who are killed on the job
Besides the above Workers’ compensation insurance is not only limited to accidents. It also covers problems and illnesses that might develop over an extended period of time due to the same injurious activity.