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Step-by-Step Guide: Top 7 Reasons Why SMEs Should Buy Work Injury Compensation Insurance
What Is Work Injury Compensation Insurance (WICA) For SMEs?
Work Injury Compensation Insurance (WICA) is an important part of any business’s risk management strategy. It provides financial protection against claims made by employees who are injured at work, or their dependents if they die as a result of such injuries. The benefits provided under this type of insurance include medical care expenses, lost wages, and vocational rehabilitation services. This article will help you understand why it is essential for small businesses to have workers’ compensation insurance in place.
7 Top Reasons Why SMEs Need To Consider WICA
1. Business Liability: Financial Security Of A Worker's Compensation Plan
One of the main reasons that small businesses need to buy Work Injury Compensation Insurance has to do with how much liability they face. Liability refers to the amount of money that you could potentially pay out to people who were hurt due to your negligence. When you're operating a small business, you usually have fewer resources to deal with potential liabilities. So, when you don't have WICA in place, you could end up paying out large sums of money to settle these types of claims.
2. Required By Singapore Law: Lawsuit Protection
Another major reason that small businesses need the right kind of Work Injury Compensation Insurance is so that they can avoid being sued. You see, there are many reasons why employees could file a lawsuit against you. Some examples include:
• A worker was injured on the job and didn't receive proper treatment.
• An employee was fired after he/she reported an employee accident.
• Someone was injured due to a defective product that you sold.
If you don't have workers’ compensation in place, then you will likely be forced to defend yourself against these types of lawsuits. This can be extremely expensive and time consuming. It also puts your business at risk of losing its license or even going bankrupt.
So, if you want to make sure that your business doesn't suffer any financial setbacks as a result of not having Work Injury Compensation Insurance, then you need to take steps to obtain this type of insurance policy.
To learn more about what you need to know before purchasing Work Injury Compensation Insurance (WICA) for your company, check out our blog post here.
3. Regulations Set By Occupational Safety and Health Division (OSHD)
The Occupational Safety and Health Division (OSHD) promotes workplace safety and health (WSH) at the national level. Workers' compensation is usually governed by state laws, but OSHD also has regulation and guideline for workplace safety. If an OSHD violation occurs, the company could face hefty penalties that wouldn't be covered by workers' compensation insurance.
It helps prevent work-related injury for sure. One of the most common causes of workplace injury is slips and falls. These types of incidents are often caused by unsafe conditions in the workplace. But if you don't have Work Injury Compensation Insurance in place, then you won't be able to cover the costs of workplace injury.
For more information about Work Injury Compensation Act, click here.
4. Great Support For Employees
It is undeniably true that small businesses should purchase Work Injury Compensation Insurance is because it helps protect your employees. Without it, you could expose your employees to unnecessary risks. For example, if you don't have WICA in place, then you could put your employees in harm's way without knowing about it.
By doing so, it helps keep your employees safe. By providing coverage for accidents that occur during the course of employment, you can ensure that your employees get the care that they need.
Let’s think this one through for just a moment. Why should the employer reduce lost wage expenses – if the insurer is helping to cover them? Why should the employer aim to have the number claiming reduced if there is coverage for each claim? Well, it implies more than showing your workers you care about their wellbeing. Its also about the financial bottomline. By keeping these costs down there is likely outcomes next year with lower premium rates. Sounds like a good idea, right?
Most studies show that there is no significant relationship between purchasing insurance and an increase in fraudulent claims. Therefore, employers should not worry too much about their employees' fraudulent claims if they choose not to purchase insurance.
5. Easy To Set Up WCI Policy
It's simple to get the correct Work Injury Compensation coverage for your company's needs these days, and by comparing among different insurers, SMEs may compare excellent providers. Pricing will vary according to the job nature and daily duties performed by employees.
The risk that employees experience will be the most important factor in deciding cost. With increased danger comes an increased demand for Work Injury Compensation. Construction and other high-risk businesses often pay more than organizations where the majority of employees work at a desk.
Safety regulations and procedures help mitigate risks, but they don't eliminate them entirely. They increase the medical care costs and remediation, too. As a result, losses due to workplace injuries are higher than if they worked in other, lower-cost areas.
6. Enhanced Employee/Employer Work Benefits
Workers' compensation policies provide benefits to both parties involved. The employee gets paid while he or she recovers from an accident. The employer receives reimbursement for medical bills and lost wages.
In addition, the comp policy provides protection against lawsuits filed by injured employees. This means that if an employee sues his or her employer over an injury sustained at work, the employer will be protected from paying out any money.
7. Every Top Profession Need Work Injury Compensation Insurance (WICA)
Lastly, small businesses need WICA is because the costs associated with not having it can be very high. In fact, some experts say that the cost of not having WICA could actually exceed the total value of your company especially if top professional jobs are involved with high pay scale. That means that you could lose more money than what you would spend on premiums!
If an employee files a Work Injury Compensation Insurance claim for injuries or work-related illness resulting from an accident at work, he or she must first file a comp claim with his or her employers.
For employees reading this article, you may want to read on Types of compensation under WICA here.
Frequently Asked Questions
What are the benefits to having Work Injury Compensation Insurance (WICA) for a small business?
WICA can be used to pay for medical bills if an employee suffers an injury at work.
Who is WICA for?
WICA is for High-hazard risk industries such as shipyard, offshore, scaffolding, diving, airline to low-hazard office risk.
What types of insurance do I need?
You may want to consider purchasing different kinds of business insurance, such as general liability & WICA, an umbrella policy (which covers multiple risks), and small business health insurance.
What is the difference between general liability insurance and workers' compensation?
Workers’ comp covers and provides employee benefits regarding injuries or illnesses suffered by employees at their place of employment. General liability insures against accidents or injuries occurring away from the workplace.
Read also: 7 Key Changes to the Work Injury Compensation Act (WICA) That SMEs Need to Know: Effective From 1st April 2021
Read also: Risk Management: Understanding Product Liability and Product Liability Insurance
Read also: Risk Management: Insurance Coverage for Business Premises – What You Need to Know
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