If you have employees working for you, you need to have workers compensation insurance place. Not only will it protect both you and your employees financially, it’s also compulsory cover for Australian employers. Workers compensation provides cover for a range of different scenarios and provides ongoing peace of mind. Today, we’ll be taking a closer look at what you need to know about workers compensation insurance.

How does workers compensation insurance work?

Workers compensation insurance allows for employers to be reimbursed for the costs associated with a successful workers compensation claim. If an employee develops a disease or obtains an injury due to work, it’s the responsibility of the employer to support their employees with associated costs. Having workers compensation insurance means that you’re covered for these costs , provided your employee can prove that their injury or illness is as a result of their employment.

The costs associated with a workers compensation claim can be very costly, even for a relatively minor incident, which is why Australia have been workers compensation insurance compulsory. Regardless of the circumstances of the incident, workers compensation insurance will generally apply. This means that even if an injury is the fault of the employee, they’re still eligible for workers compensation cover. Workers compensation insurance is required for all employees, including part time, casual and seasonal workers. In some cases, contractors and subcontractors will also need to be covered under your workers compensation insurance policy.

Every state government regulates their own scheme and the way the various schemes are administered varies from state to state. For example, in Queensland the scheme is operated solely by the government. In other states, insurers are also involved in the administration of the schemes.

What does workers compensation insurance cover?

Lost wages

When an employee suffers from a work related illness, workers compensation insurance means that they’ll continue to receive at least a portion of their regular wages while they recover. This allows an employee to keep up with living costs, such as rent and mortgage, while they’re unable to work.

Medical expenses

Following an injury, it’s not just lost wages that employees need to think about. An injury could also mean medical costs associated with treatment of the injury. Whether it’s the ambulance bill, hospital costs and doctor bills, workers compensation insurance will provide cover for these costs.

Ongoing expenses

After an injury, there are often ongoing related expenses which assist with recovery and rehabilitation. This could include ongoing specialist appointments, surgery costs, and physiotherapist and chiropractic care. Workers compensation insurance will cover the ongoing costs associated with a successful claim.

Legal costs

In some cases, an employee may choose to sue your business following a work related injury. In this situation, a court case very costly and results in significant financial hardship for your business. Your workers compensation insurance will support you in the costs associated with court proceedings, such as legal bills, court costs and settlement amounts.

Funeral costs

In the event of a catastrophic injury which results in the death of an employee, workers compensation insurance provides cover for funeral and other death related expenses. This inclusion is particularly important if you work in a high risk industry.

While workers compensation insurance covers a range of scenarios, there are certain things that it won’t cover. These include:

  • Wages for a replacement employee – in many cases, you may need to hire a replacement employee to cover another employee while they’re off work on workers compensation. Your workers compensation insurance won’t cover the wages you pay for any replacement employee.
  • Fines and penalties – in some cases, businesses are required to pay fines or penalties for not following the appropriate safety standards at work. If you need to pay a fine or penalty, your workers compensation insurance won’t cover this.
  • Safety improvements – following a workers compensation claim, you may realise that improvements need to be made to improve the safety of the workplace. Even if an improvement is directly related to the injury sustained by an employee, your workers compensation insurance won’t provide cover.
  • Third party injury – workers compensation insurance only covers injury which occurs to an employee – it won’t cover a third party who becomes injured. This would be covered by your public liability insurance.

How much does workers compensation insurance cost?

The cost of your workers compensation insurance is calculated depending on a number of factors. These include the industry that you work in, how much you pay your employees, the size of your business relative to your industry, and any past workers compensation claims.

To calculate your workers compensation insurance, you’ll be required to give details of your business activities as well as a wages estimate and your workers compensation claims history. In most cases, your state or territories workers compensation scheme will allocate a rate for each industry. This rate is calculated depending on the risks and historical claims information associated with the specific industry. In general, the cost of your insurance will be your wages estimate multiplied by the industry gazette rate.

Insurance for Australian tradies

All Trades Cover work hard to make insurance as easy as possible for Australian tradies. We’re proud to be one of Australia’s fastest growing insurance providers and our signature trade insurance package provides you with financial peace of mind while you’re at work. We provide workers compensation insurance Australia, along with a range of additional policies which apply to your work.

For a workers compensation insurance quote, contact All Trades Cover today on 1300 826 850 or go online for an easy quote.

John Elliott

John Elliott

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An industry veteran with a vision to revolutionise insurance for tradespeople, John Elliott founded All Trades Cover with a commitment to make insurance easy, efficient, and affordable for tradies across Australia.

With 2 decades of experience and thousands of insured clients nationwide, John’s vision has become a reality. All Trades Cover is now a trusted partner for tradies, offering top-tier coverage at competitive prices. But it’s not just about cost savings.

John’s innovative approach focuses on simplicity and speed without compromisingon quality.

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