The workmen’s Compensation act 1923 was amended in 2009 and was named as Employees’ Compensation (Amendment) act 2009. Subsequently, an additional notification was issued on 31.05.2010.

The act provides for the payments of compensation by the employer to his employees’ (or their dependents in the event of a fatal accident) if personal injury is caused to them by accidents arising out of and in the course of their employment.

The definition of Workmen is widened in WC act 2000 to include a person whose EMPLOYMENT IS OF CASUAL NATURE as well as those employment otherwise than for the purposes of the employers’ trade or business.

The maximum compensation payable is upon the following as per WC amendment act 1984 December – 2000 & 2009. (The maximum liability under the policy will be limited to monthly wages of Rs.8000).

(Where death results from the injury, an amount equal to 50% of the diseased workmen on monthly wages multiplied by the relevant age factor or an amount of Rs.1,20,000 whichever is more).

(Where permanent total disablement results from the injury, an amount equal to 60% of the workmen on the monthly wages multiplied by the relevant age factor or an amount of Rs.1,40,000 whichever is more).

C) Permanent Partial Disablement:
As per % of the loss of earning capacity. It varies from 1% to 90%

D) Temporary Disablement:
An amount equal to 50% of monthly wages subject to the maximum of Rs.4,000. No compensation would be payable up to 3 days disablement. But if it is more than 3 days but less than 28 days than 50% of balance days wages are payable. Disablement exceeding 28 days, then no deduction of 3 days.

This would mean that the maximum liability under the policy will be limited to monthly wages of Rs. 8000.

THE INDIAN FATAL ACCIDENTS ACT, 1855:

This act enables claims for damages up to an unlimited amount to be maintained against a person who by his wrongful act, neglect or default causes death to another.

THE COMMON LAW:

The common law gives a person the right to claim from another, for damages up to an unlimited amount, for injury or loss sustained on account of the negligence of such other person or his Servants acting in the scope of their employment.

TWO FORMS OF COVERS ARE AVAILABLE:

TABLE – A: Indemnity against the employer’s legal liability to his employees under the “INDIAN WORKMEN’S COMPENSATION ACT 1923, and subsequent amendments of the said act prior to the date of issue of the policy and INDIAN FATAL ACCIDENT ACT1855”, and at common law.

TABLE – B: Indemnity against the employer’s legal liability to his employees under the INDIAN FATAL ACCIDENT ACT, 1855 and at COMMON LAW.

In case of risk coming under the purview of the Employee’s State Insurance Act 1948, it is, however permissible to issue separate Table “B” Policies covering those members or Staffs who are not employees within the meaning of the Act, provided all such employees in the insured’s service are included therein.

The employer can cover their employees who are drawing above Rs.8000/- salary/wages per month. The premium shall be calculated as per tariff on their Annual wages.