Workmen Compensation Policy
The Workmen's Compensation Insurance Policy provides for legal liability coverage for compensation to
your employees for bodily injury or death caused due to accidents / occupational diseases arising out of
and in course of employment.
The workmen's compensation insurance is the primary method by which an employer can demonstrate the
ability to satisfy the obligations imposed by the worker's compensation statutes. It is compensation payable
under a scheme set out in the Workmen's Compensation Act of India, monitored by the Ministry of Labour.
This product is addressed to:
All manufacturing units with employees who fall under the purview of the Workmen's Compensation
Insurance Act, 1923 have Employers' Liability exposures under the Act. All business organisations have
Employers' Liability exposures under Common Law and such organisations form the target market for this
class of business.
The policy covers legal liability of an employer under:
Table 'A' - Indemnity against legal liability to all employees (whether or not coming within the definition of
the term Workmen) under the W.C.Act 1923 and subsequent amendment to the said Act (amended in
2008) prior to the date of issue of the policy, the Fatal Accidents Act, 1855 and at Common Law.
Table 'B' - Indemnity against legal liability under the Fatal Accidents Act, 1855 and Common Law. (Table 'B'
policies may not be issued to cover employees who fall within the definition of "Workmen" under the
Workmen's Compensation Act, 1923 as amended)
SCOPE:
1. To pay all sums which the insured is legally liable to pay the employees in respect of personal injury
by accident or diseases 'arising out of and in the course of the employment'
2. Insured's liability arising either under common law or the laws set out in the schedule Workmen's
Compensation Act 1923.
3. Costs or expenses incurred by the insured with the consent of the company, to defend any claims
are paid in addition.
Extensions:
Actual medical, surgical and hospital expenses including the cost of transport to hospital for
Accidental employment injuries
Any compensation for diseases mentioned in Part ‘C’(Occupational Diseases like Asbestosis, Silicosis
etc) of Schedule III of the Workmen’s Compensation Act, 1923, which arise out of and in the course
of employment
Extension for contractor’s workmen to cover the principal’s vicarious liability.
Under Workmen's Compensation Act, compensation is calculated as follows:
1. For accidents resulting in death, an
amount equal to fifty per cent of the
monthly wages of the deceased workman
multiplied by the relevant factor (based
on the age of employee); or an amount of
one lakh twenty thousand rupees,
whichever is more
2. For permanent total disablement, an
amount equal to sixty per cent of the
monthly wages of the injured workman
multiplied by the relevant factor, or an
amount of one lakh forty thousand
rupees, whichever is more.
Maximum wages for the purpose of
calculation of compensation is fixed at Rs
8000. Therefore, 50% or 60%, as the case
may be the salary at the time of accident
or death subject to a maximum of 8000
shall be multiplied by the relevant factor
given as per the table to calculate
compensation.
1. Compensation In case of Death:Sec 4(1)(a) - 50% of monthly wages or an amount of 1, 20,000 which ever
is more.
(Monthly wages x Relevant factor) X 50 / 100
And Rs.2500/- extra for funeral expenses u/s 4(4) by amendment of 2006
2. In case of Permanant Total Disablement:Sec 4(1)(b) - 60% of monthly wages or an amount of 1, 40,000/-
whichever is more
(Monthly wages x Relevant factor) X 60 / 100
How is the amount of compensation decided?
The compensation to be paid by the employer for
injuries caused depend on extent of the disablement suffered by the worker; more severe disablements
naturally receive higher compensation.
This has been categorised as follows: Compensation payable in case of:
1) Death; 2) Disablement
. (a) Permanent total disablement;
. (b) Permanent partial Disablement
. (c) Temporary disablement-
. (i) Temporary total disablement;
. (ii) Temporary partial disablement.
In addition, the guiding principle is, the higher the age of the injured worker, the lower the compensation.
Exclusions:
1. Any injury by accident or disease directly attributable to war and nuclear risk
2. Insured's liability to employees of contactors to the insured (this exclusion can be waived if the
coverage is opted as an extension by the payment of additional premium)
3. Any liability of the insured which attaches by virtue of an agreement.
4. Any compensation for diseases mentioned in Part 'C' of Workmen's Compensation Act-1923
Compensation is not payable by the employer in the following circumstances:
Where the disablement does not last for more than three days.
Where the disablement has arisen out of the following: (a) Drugs or drink;
(b) Disobedience;
(c) Disregard for the safety measures prescribed.
Below is the list of documents for a claim under WC policy
. Claim Form Duly Filled
. Brief note on incidence & nature of injury sustained by employee.
. Copy of first prescription by the treating doctor
. Medical Certificate , Medical reports (Lab reports) and original medical bills (If applicable)
. Leave certificate from insured (in case of injury of the worker, incapacitating him/her from work )
. Wage Slip for last 3 Months of the injured/deceased
. Copy of Wage register for the preceding 3 months for Total employees covered location with the
mention of Skilled / unskilled
. Copy of Muster Roll for the 3 preceding months Covering Total employees covered under the said
location
. The Memorandum of Agreement required to be submitted to W/C Commissioner while depositing
compensation as per W/C act and award copy of WC.
. Receipt from WC Commissioner having received the amount from insured,
. Proof of age of employee.
. Hospital Bills including all investigation reports if injured or deceased is treated in a hospital
. Original disability certification from medical board (Mentioning percentage of disability), if the worker is
injured or disabled
. Clear Photo of Injured body part and Full body Photo of injured person
Additional Documents in case of death of the worker:
FIR
Letter of Intimation to Inspector of Factories
Death certificate
ID proof of the deceased
Medical records
Doctor certificate
Bank details
Form-18 as per WC act
labor license
Panchanama / FSL (Forensic Science Lab) Report etc / MLC (Medico Legal Certificate) in case of Road
accident whilst on duty
The above are the main documents that are insisted and Labour License may also be asked in terms of
the compliance related matter only and lack of it would not become a hindrance to the claim settlement
by the insurer.
Premium Calculation:
The premium is calculated as per basic tariff rate/mile based on the trade or business of the proposer.
