Is a Workmen's Compensation Policy Needed for Organizations Under ESIC?

Dear All,

I have a small query. Is it necessary for the organization covered under ESIC to have a workmen's compensation policy? If so, please suggest what type of policy we should go with. Does anyone have a model copy available that they can share with the team?

Thank you.

If you have employees with a salary of Rs 15,000 or more, then you need to obtain an employee compensation policy for them.

Çompensation policy is not mandatory. If you have employees not covered under ESI and who are within the definition of the employee under the EC Act, it is better to cover them under an EC policy against your liabilities under EC Act.

Dear SVRamana,

If there is ESIC, there is no need for workmen's compensation. However, if you have employees with a gross salary of more than 21000/-, you can cover them under WC. But, along with WC, you have to cover them with mediclaim as well because WC only covers loss of pay, while ESIC covers both loss of pay and medical expenses.

ESI Act and Employer Responsibilities

The ESI Act is applicable where ESIC can provide medical benefits. Where the ESI Act is not applicable or where employees are out of coverage due to a higher salary, the employer is responsible for compensating an injured employee. The employer cannot predict when an accident will occur or its severity. Therefore, they will not know the amount of compensation that will need to be paid. Furthermore, in the case of death or permanent total disability of an employee, the compensation amount is to be paid through the Court. Therefore, it is wise to take out a policy known as WC or EC Policy. This policy is a standard policy available with any insurance company, but it covers only injuries arising out of and in the course of employment.

General Policy for 24/7 Coverage

If an employer wants to cover employees 24/7, then a general policy is taken. This policy covers all employees all the time for any injury anywhere.

Regards, Vibhakar Ramtirthkar

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Thank you for your prompt response, Mr. Vibhakar. We are planning to implement a policy to protect our employees both within the workplace and when they are on duty at other sites of our company. Could you kindly recommend some of the best insurance providers to us along with their contact details?

From 2010, employers have a liability to reimburse medical expenses to injured employees in addition to compensation. It is advisable to have a policy that covers medical reimbursement as well.

Varghese Mathew - TVM
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