Workmen compensation policy is a type of insurance policy that safeguards an employee against any injury or death during the job time. Businesses with extreme exposure to health or life hazards have a risk of injury or the death of one or more employees, and employers are very keen on finding an affordable to way to deal such heavy expenses, especially with the growing economy.
It helps the employer to protect the most valuable asset of the organisation i.e. employees. In a situation where the job profile involves certain risks that can cause injury or causes the death of an employee, this insurance policy works like a shield and protects the employer against heavy expenses incurred due to handling workers’ liability. With workmen compensation, an employer can ensure safety for his/her employees or workers at an affordable price and limit liabilities against any adverse situations.
Unfortunately, construction workers perform hazardous work and are at risk of injury far too often when on the job.
Cranes and other heavy equipment used on construction sites in large building projects can be deadly if not operated appropriately and carefully. Getting hurt on the job can have devastating consequences for anyone working construction. Workers’ compensation is a valuable protection for all construction workers.
As an employer, one is liable to pay compensation in case of death, permanent total or partial disability and/or temporary disability.
Workers compensation insurance serves two purposes: It assures that injured workers get medical care and compensation for a portion of the income they lose while they are unable to return to work and it usually protects employers from lawsuits by workers injured while working.
This insurance is mandatory under The Workmen’s Compensation Act, 1923, in India. It is important for both the employee and the employers.
The premium of Workmen Compensation policy is very less as compared to the benefits which are ought to be received at the time of any miss happening. In the era where the inflation in healthcare sector is at its top, the medical extension benefit is an additional advantage.
In the field of engineering and construction, the workers are exposed to dangerous equipment, dust, smoke and several health hazards and the chances of mishaps are obvious. Most of the workers are from low income group and only earning member in their family. Therefore, if they are covered under such scheme then then the stakeholders can concentrate on their projects without indulging in legal and police related affairs.
The premium depends on annual wages and type of work. More hazardous the work, more will be the premium and vice versa. It should be noted that never declare less wages as compared to actual or misrepresent the nature of work as it will prejudice the claim.
Likewise, the calculation of claim amount also depends on quantum of wage drawn by deceased or injured employee and age, percentage of disability.
The formalities at the time of claim are also very less and procedure is too easy. The basic workmen compensation policy mainly covers loss of earnings due to disability and death. The more the disability more will be the claim amount and it will be maximum in case of permanent disablement.
The medical expenses can be covered on payment of extra premium. The premiums can be reduced by providing safety gears like helmets, boots, safety jackets and masks to all the employees and installing safety devices such as scaffolding, safety nets and ropes at the construction site.
Amit Agarwal, Director, Ideal Insurance Brokers