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Workmen Compensation Insurance
A workmen compensation policy provides financial support to employers to cover their legal liabilities in case employees suffer from work-related injuries, illnesses or fatalities. Workplace accidents can happen even in the most careful environments, and when they do, both employees and employers can incur heavy out-of-pocket expenses.
Since Indian labour laws hold employers legally responsible for compensating workers under the Employees’ Compensation Act, 1923, this policy acts as both a safeguard and a tool that ensures legal compliance.
TATA AIG’s Workmen’s Compensation Insurance is designed to help employers fulfil this responsibility. It covers medical expenses, lost wages and compensation for permanent or temporary disability resulting from work-related accidents. This not only ensures that affected employees are supported but also helps businesses stay legally protected.
What is the Workers’ Compensation Meaning?
Workmen’s compensation (WC) or workers’ comp policy that provides financial protection to employees if they suffer injuries, disabilities or death due to workplace accidents or occupational diseases. It is a legal requirement under the Employees’ Compensation Act, 1923, which makes it mandatory for employers to compensate workers in such cases.
The WC policy ensures that medical expenses, loss of wages, or compensation to dependents are covered, without employers having to bear the entire cost themselves. In simple terms, it safeguards both employees’ well-being and employers’ legal liabilities.
Suppose an employee is unable to work for a while due to a workplace injury. In that case, the workmen’s compensation policy (WC policy) ensures they still receive a portion of their regular salary during their recovery.
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What is the Workmen’s Compensation Act?
The Workers’ Comp Act, 1923 (now called the Employees’ Compensation Act after the 2010 amendment) provides financial protection to employees who suffer injuries, illnesses or death due to workplace accidents. It is designed to ensure that workers, especially those not covered under the Employees’ State Insurance (ESI) Act, receive fair compensation for work-related risks.
The WC Act holds employers legally responsible for compensating employees for loss of income or life arising out of and during the course of employment. It applies to various sectors, including construction, transportation, manufacturing and more.
Key Provisions at a Glance
Accidental Death- 50% of monthly wages × relevant age factor
or ₹1.2 lakhs, whichever is higher.Permanent Total Disability - 60% of monthly salary × relevant age factor
or ₹1.4 lakhs, whichever is higher.Permanent Partial Disability-
- If the injury is listed in Part II of Schedule I (WC Act), a part of the full disability amount is paid based on how much the injury affects the person's ability to work.
- If the injury isn’t listed, a doctor will check the disability and decide the amount.
Temporary Disablement - 25% of the worker’s monthly wages is paid every
two weeks, as per the policy rules.Not Covered / Exemptions - No compensation if the injury was due to the
employee’s negligence, intoxication, or drug use.
Please note: This is the basis for calculating the amount of compensation. The actual benefit can differ for individual cases based on the conditions specified under the Workmen’s Compensation Act of 1923 and the workmanship compensation policy. Refer to The Workmen's Compensation Act of 1923 for more details and key updates.
Why do you need a Workmen’s Compensation Policy?
A workmen’s compensation insurance helps protect both employers and employees when accidents happen at work. It’s not just a legal requirement; it’s also smart business.
Legal Requirement
Some businesses are legally required to compensate workers for job-related injuries. A WC policy ensures you are on the right side of the law.
Avoid Penalties and Legal Trouble
If an employer doesn’t pay compensation, they may face court cases, fines, or both. A WC policy protects you from this risk.
Covers Medical and Income Loss
The policy pays for the employee’s medical bills and lost wages due to work-related injuries, disabilities or illnesses.
Covers All Types of Workers
It can cover not just full-time staff but also temporary and contract workers, offering wider protection.
Helps Build Trust and Reputation
Taking care of employees shows that your company values its people. This builds a positive image among workers and the public.
Better Focus on Business
With best workers’ comp insurance in place, you can focus on running your business without worrying about unexpected costs or legal issues.
Smoother Contractor Relationships
Contractors are more likely to work smoothly and release payments on time when they know your workers are insured.
Prevents Union Conflicts
Supporting injured employees financially can help prevent issues or strikes from employee unions.
Who Should Buy a Worker’s Comp Online?
Employers engaged in industries involving manual, technical or high-risk work should purchase worker’s comp insurance, whether mandated by law or not. The WC Act, 1923, outlines eligibility conditions for both employers and employees.
Employer Eligibility
- Applies to employers listed in Schedule II of the Act, including sectors like construction, manufacturing, mining, plantations, transportation, railways and shipping.
- Includes contractors and subcontractors hiring workers for the above-listed activities.
- Employers not registered under the Employees’ State Insurance (ESI) Act or operating in areas where ESI isn’t available must compensate employees under the WC Act.
- No specific employee count is mentioned, but small businesses (generally with fewer than 10 workers) often fall under this Act in practice.
Employee Eligibility
- Covers workers, defined as “workmen,” under Schedule II, including those involved in manual, skilled, semi-skilled, unskilled, technical, operational, or clerical roles.
- Includes Indian workers employed overseas in eligible roles.
- Excludes administrative, managerial, or supervisory staff, unless the job profile is specifically listed.
- Does not apply to employees covered under the ESI Act (as per Section 53 of the ESI Act).
- Employees are covered for injuries, illnesses, or death arising out of and in the course of employment.
Contractors or subcontractors hiring temporary, seasonal or daily-wage labour for physical tasks.
Employers of workers involved in technical, mechanical or operational roles, as listed under Schedule II of the Act.
Even if not legally mandated, buying a workmen’s compensation policy is a responsible step for any employer to protect both their workforce and business from financial risk.
Benefits of TATA AIG WC Policy
A few important workmanship compensation policy’s benefits are as follows:
Enhances brand image
Prioritising employee safety and well-being helps build trust in your company among both employees and clients.
Promotes workplace safety
Employers improve workplace safety standards to reduce accidents.
Online purchase
Employers can purchase the workmen’s compensation policy online in a few simple steps.
Streamlined claim settlement
The steps to initiate a claim and the process of claim settlement are streamlined.
Extensive coverage
A workers’ compensation policy provides extensive coverage that can cover a large workforce.
Inclusive coverage
The policy can cover different degrees of disabilities and diseases and their medical treatments.
Add-ons
Employers can include add-ons, such as for medical extension cover and occupational diseases, under employee’s compensation insurance.
Flexibility
The WC policy offers the option to customise the coverage based on the number of employees and policy tenure.
Types of Workmen’s Compensation Insurance Policies
There are two main types of Workmen’s Compensation (WC) policies that employers can choose from, depending on the nature of their workforce:
Named Policy
This policy covers specific employees whose names are mentioned in the policy. It is ideal for businesses with a fixed team or where only certain high-risk roles need coverage.
Unnamed Policy
This policy covers all workers without naming them individually. Best suited for businesses with a changing or contract-based workforce, such as seasonal or temporary staff.
Types of TATA AIG Workmen’s Compensation Policies
Workmen’s compensation insurance can be tailored to offer different levels of protection. Depending on your business needs and the nature of work involved, you can choose from the following three types of coverage:
Basic WC Policy
It provides basic coverage to compensate for the employee’s loss of income due to workplace accidents that lead to disabilities or death.
WC Policy with Medical Cover
On the Basic WC policy, you get coverage for medical expenses incurred during the treatment of work-related injuries.
WC Policy with Medical Extension Cover of ₹25,000
On the Basic WC Policy, you get a medical extension cover of ₹25,000. It can be used to cover minor or moderate work-related injuries.
For more detailed information, you can refer to Types of Workers’ Compensation Insurance.
What Does Workmen’s Compensation Insurance Cover? (Inclusions)
Covers bodily injuries caused directly by accidents that occur during the course of employment. This includes injuries that happen on-site or while performing assigned job duties.
- Permanent Total Disability: Covers situations where the employee becomes permanently and fully disabled, affecting their ability to work and earn in the future.
- Permanent Partial Disability: Provides compensation for permanent but partial disabilities that reduce the employee’s earning capacity.
- Temporary Disability: Covers temporary total or partial disabilities where the employee is unable to work for a certain period due to the injury.
The workmen insurance policy covers medical treatment costs for injuries or illnesses that occur due to the job. This may include hospitalisation, surgery, medicines and doctor consultations, depending on the policy terms and selected add-ons.
Illnesses caused by prolonged exposure to hazardous work conditions (e.g., chemicals, dust, extreme temperatures) are covered through a specific add-on. These are conditions that develop over time due to the nature of work.
If an employee dies due to a workplace accident, the policy provides financial compensation to their legal beneficiaries or dependents, helping them manage the loss of income.
The policy also covers legally approved expenses related to claim settlements, including lawyer fees and court proceedings, if applicable.
Please Note: The inclusions can differ for individual cases. Please refer to the WC policy document for the detailed inclusions and policy conditions.
What Does Workmen’s Compensation Insurance Not Cover?
Injuries from negligence and misconduct
Accidental injuries after consuming alcohol or drugs, neglecting safety rules, and intentionally removing or ignoring safety devices.
Occupational diseases
Illnesses developed due to working in hazardous work conditions over a long time are excluded unless covered by the policy.
Injuries caused outside the work environment
Accidents that occurred outside the workplace unless the employee was there on duty for the business.
Injuries to employees employed by contractors
Injuries to persons employed by a contractor or sub-contractor of the insured, unless specifically covered in the employees’ compensation policy schedule.
Injuries to unspecified employees
Injuries suffered by a person who is not declared eligible for insurance under the WC Act or this policy.
Injuries that do not meet disability conditions
Injuries that do not cause partial or total disablement for more than three days.
Medical treatments
Medical expenses for treating any injury unless specified under the policy.
Interest and penalty (for the employer)
Interest and/or penalties imposed on the insured under any law or otherwise.
Agreement-based compensation
Payments to be made by the employer based on their agreements but not legally compulsory are not covered.
Injuries due to war
Injuries or illnesses due to war, enemy attacks, civil war, rebellion, or military actions.
Please Note: This is a general list of exclusions. Please refer to the policy document for detailed exclusions before purchasing the policy.
Workmen’s Compensation Policy Coverage: Add-Ons
Medical Extension Cover
The medical extension cover offers additional workers’ compensation for medical expenses up to ₹1 lakh or more in specific scenarios. It can cover the medical expenses for the employee’s treatment based on the policy terms and conditions.
Occupational Diseases Cover
The occupational diseases add-on under an employee’s compensation insurance covers diseases or illnesses caused by hazardous workplaces or working conditions. For example, employees working in mines or chemical industries might develop a breathing disorder.
Terrorism Cover
This cover provides additional coverage against accidents caused by violent behaviour from employees, such as during a union meeting. This can be beneficial for industries that employ a larger workforce and have a higher chance of frequent labour issues.
How to Buy Employee’s Compensation Insurance Policy from TATA AIG?
Buying the TATA AIG employee’s compensation policy is an easy, 3-step process online. Alternatively, you can also visit one of our branches, and one of your customer support experts will guide you through the process.
Here are the quick steps to buy the plan online:
Select trade category
At the beginning of this page, choose your trade category (business category) for the WC policy and click on “Get Plan.” Then, enter your mobile number and proceed.
Provide essential information
Enter the required details, such as risk location pincode, policy tenure, worker categories, number of workers in the specific categories and average monthly wage.
Check quote and proceed to buy
Check the applicable premium and review the workers’ compensation policy terms and conditions. Pay the premium online to complete your purchase.
Documents Required to Buy Employee Compensation Policy
Completed Proposal Form
A fully filled proposal form signed by an authorised representative from the company.
Organisation’s KYC Documents
Certification of incorporation
GST Certificate, if applicable
PAN (Permanent Account Number)
DIN (Director Identification Number)
Copy of business commencement certificate
Copy of ITR (Income Tax Returns)
Employee Records
Detailed records of the number of workers and their job profiles.
Salary Information
Average salaries of the workers belonging to the different job categories or specific salary information.
Additional Documents
Any other documents as required by the insurance company.
Also Read: Workers’ Compensation Insurance Premium Estimation: How it’s done.
Workmen Compensation Insurance Premium Calculator
The premium for a workers compensation insurance (WC) policy is calculated based on several factors, including the nature of your business, the number of employees, their job roles and the total wages paid. Riskier job profiles (like construction or manufacturing) usually have higher premiums compared to low-risk roles.
Using a Workmen Compensation Insurance Premium Calculator helps you estimate the premium accurately based on these details, ensuring you choose the right level of coverage without overspending.
Also Read: Workers’ Compensation Insurance Premium Estimation: How it’s done.
Workmen’s Compensation Policy Claim Process
Claim intimation
Give a written notice to TATA AIG about the incident within 7 days of the occurrence and no later than 30 days of the actual loss.
Submission of claim form and evidences
Fill out the workers’ compensation insurance claim form and gather evidence related to the incident. Submit them within 30 days from the date of actual loss.
Submission of supporting documents
Collect all the necessary supporting documents, including the doctor’s prescriptions and medical records, for the employee’s compensation.
Claim settlement
TATA AIG will review your documents and proceed to settle the claim within 30 days of submission of all the documents. The claim will be settled in a court of law.
Workmen’s Compensation Policy: Documents Required for Claim Process
Workers’ Compensation Insurance: Documents Required for Death Claims
**Basic Claim Documents** - Duly filled Claim Form - Original Death Certificate **Medical Records** - Post-mortem Report (original or attested) - Medical reports, if the employee was hospitalised **Police and Legal Reports** - FIR (attested copy) - Spot Panchanama and Police Inquest Report (if applicable) **Identity Proof** - KYC documents of the deceased employee or nominee (Aadhaar Card, PAN Card, Passport, etc.)
Employee Compensation: Documents Required for Disability Claims
**Basic Claim Documents** - Duly filled Claim Form **Medical Records and Certification** - Doctor’s Report - Disability Certificate issued by a certified medical practitioner (original) - Medical reports, including diagnostic and investigation reports **Police and Legal Reports** - FIR (attested copy) - Spot Panchanama and Police Inquest Report (if applicable) **Identity Proof** - KYC documents of the employee (Aadhaar Card, PAN Card, Passport, etc.)
Conditions Regarding Workmen Compensation
Eligibility Conditions
The WC Act applies to employees involved in manual, technical, or supervisory roles. It is particularly important for industries such as construction, manufacturing, logistics and transport. Workers not covered under the Employees’ State Insurance (ESI) Act are typically eligible under the WC Act.
Scope of Coverage
The policy covers injuries, disabilities, or death that occur directly due to the employee’s job or while performing work duties. It includes compensation for loss of income, and if opted, medical expenses related to treatment and recovery. Coverage may also extend to temporary and contract workers based on the policy type selected.
Employer Obligations
Employers are legally responsible for compensating employees who are injured or fall ill due to work-related reasons. They must ensure timely reporting of incidents, maintain accurate wage and employment records and select a workers compensation insurance policy that aligns with the risk level and nature of their workforce.
Exclusions
The policy does not cover injuries resulting from an employee’s own misconduct, such as working under the influence of alcohol or drugs, intentional self-injury, or accidents unrelated to work duties. Claims may also be rejected if the employer fails to disclose correct information or maintain proper documentation.
Claim Conditions
Accidents or injuries must be reported within the timeframe specified in the policy document. For disability-related claims, a qualified medical professional may be required to assess the extent of injury. Compensation is calculated based on the type and severity of the injury and how it affects the employee’s ability to earn.
Duration of Workers’ Compensation Insurance
The minimum policy tenure for the workmen insurance policy is 1 month, and the maximum policy tenure is 12 months. It can be purchased for a minimum of one or two employees, and the maximum number depends on the specific policy conditions.
For more detailed information, you can refer to Types of Workers’ Compensation Insurance.
How to Choose the Right Workmen’s Compensation Policy Online for Your Business?
Choosing the best workmen’s compensation policy is important to ensure your employees are protected and your business stays secure.
Understand Your Workforce
Look at the type of workers you employ (full-time, contract-based or seasonal) and the nature of their work. This helps you decide between named or unnamed policies and understand the kind of coverage you need.
Know Your Risks
Assess the possible risks in your workplace. Whether your employees are handling machinery, chemicals or working at a desk, knowing the possible injuries or illnesses will help you choose the right level of protection.
Explore Policy Options
TATA AIG offers a range of policies, from basic workmen’s compensation policies to ones that include extended medical coverage. Choose a policy that balances cost with the benefits your employees may need.
Buy with Ease
You can buy your WC policy online in just a few clicks or visit a TATA AIG branch nearby. Our customer support team is always ready to help you select and customise a policy that matches your business requirements.
Why Should You Buy a Workmen’s Compensation Insurance Policy from TATA AIG?
Expert advice
We can help you assess your work environment and help you choose the best WC policy to cover your legal obligations.
Instant policy purchase online
You can purchase a workers’ compensation insurance policy with us instantly in a few simple steps online.
Wide range of business categories
We cover multiple trade categories, such as chemical workers, builders, electrical engineers, metal workers, painters and more.
Three WC policy options
You can choose between the Basic WC Cover, WC with Medical Cover and WC with Medical Extension.
Competitive premium rates
We offer comprehensive coverage at affordable premium rates.
Add-ons to enhance coverage
You can customise the policy with the medical extension, occupational diseases and terrorism cover add-ons.
Claim support through the year
We provide a dedicated customer support team to address all your specific issues related to claim settlements.
Dedicated relationship manager
We assign a dedicated relationship manager to handle your WC policy to ensure timely assistance.
Frequently Asked Question
