Info About Insurance

Workmen's Compensation Insurance in India

The Workmen’s Compensation Act apples to all the employees included in the definition of the “Workmen under Section 2 (I) (n) of Chapter I and 11 of the Act.   Workmen’s Compensation Insurance is intended to cover the employer for liability towards payment of compensation under the amended Workmen’s Compensation Act 1923. 

 Coverage: 
 

The Policy seeks to indemnify the insured employer against his liability to employees in respect of accidents and diseases of occupation under  
 

• The Workmen’s Compensation Act, 1923
• The Indian Fatal Accidents Act,1855
• The Common Law

This covers liability to their employees for personal injuries and to their dependants in the event of fatal accident arising out of and in the course of employment.   Employees of sub contractors have the right to claim compensation direct from the principal who may, however, obtain reimbursement from the main contractor.   Cover in respect of claim on the principal to pay compensation to contractors Workmen is normally excluded form the scope of the policy. Provision is however made for including the same by endorsement when the wages paid to other contractor’s Workmen are included in the amount of wages declared. 
 

The Fatal Accidents Act 1855 provides specifically for payment of damages by any person who by wrongful act, neglect or default cause the death of another person.   The Act gives certain relatives of the person killed a right to claim damages in their own name.   The damages are assessed in accordance with the pecuniary loss occasioned to the relations by the death, which is based on the earning capacity of the deceased during the normal expectation of his life, prior to his death.  An employer may be liable to pay damages for injury arising from an accident caused by the negligence of the employer, Defects in machinery, Carelessness of the fellow employee etc.   Contributory negligence, i.e. negligence on the part of the injured workmen does not fully absolve the employer from his liability.   Here also, there is no limit to the amount of damage, which of may be awarded to the aggrieved party. 
 
 

The Workmen’s Compensation Act lays down that if personal injury is caused to a workman by accident, arising out of and in course of his employment, the employer shall be liable to pay compensation.   
 

Two forms of covers are available: 
 

Table A Policy

• The Workmen’s Compensation Act, 1923
• The Indian Fatal Accidents Act,1855
• The Common Law

Table B Policy

• The Indian Fatal Accidents Act,1855
• The Common Law

Exclusions:

War and allied perils

Liability to employees of contractor

Any employee who is not a workman within the meaning of the Laws

Any contractual Liability

Nuclear exclusion 
 
 

The following are the few exceptions under which no compensation would be payable. 
 

1. An injury which does not result in fatal or partial disablement for a period exceeding 3 days.
2. For any injury for the first 3 days of disablement unless such disablement lasts for a period of 28 days or more.
3. For any, injury not resulting in death caused by accident of attributable to :

1. workmen have for the relevant time under the influence of drinks or drugs :
2. Willful disobedience of the workman to an order expressly give or to a rule  expressly framed for the purpose of security safety of the workmen.
3. Willful removal or disregard by the workmen of any safety guard or other device, which he knew to have been, provided for the purpose of security the safety of the workmen.

If a workman institutes a claim before the Commissioner for workmen’s compensation for damage in respects of his injury he cannot subsequently institute a civil suit against his injury he cannot subsequently institute a civil suit against his employer.   Similarly, if he institutes a claim under common law he cannot subsequently claim compensation under the Workmen’s Compensation Act.   The workman has to choose his forum of redressal. 
 

      It is also essential that the employer should take steps to ensure that every accident is brought to the notice of the Company.   The occurrence of every factual or serious accident should definitely be reported to the Commissioner for Workmen’s Compensation within the time limit.   The amount of compensation except in the case of a minor is based entirely on the earnings of the deceased or the injured workmen prior to the accident the earnings of the deceased or the injured workmen prior to the accident. 
 

The compensation payable for death, permanent total disablement and the half-monthly compensation for temporary disablement are calculated in accordance with the provisions under Section4 & schedule IV of the Act. 
 

Referral risks:

• Aviation
• Ammunition filling
• Breaking down of explosives
• Collieries
• Explosive Factory
• Fireworks Factory
• Gunpowder Factory
• Mines
• Quarries
• Railways
• Shipping
• Tunneling