Workers’ Compensation Insurance is a mandatory policy designed to cover an employer’s liability for benefits to employees who are injured or become ill while at work.
The foundation of every safe workplace
It is one of the most essential forms of insurance, as employees are a business’s most valuable asset. In Australia, all businesses with staff must have this insurance, which is regulated by Safe Work Australia, though each state also has its own governing body.
What Workers’ Compensation Insurance Covers
Workers’ Compensation Insurance generally provides:
Wage Replacement
A percentage of the employee’s wages while they are unfit for work due to injury or illness.
Medical Expenses
Costs associated with hospital treatment, GP visits, physiotherapy, surgery, and other approved medical care.
Rehabilitation Costs
Support for recovery and return-to-work programs.
Additionally, some policies may include:
Lump Sum Payments
For permanent impairment or serious injury, subject to assessment and eligibility.
Return-to-Work Support
Funding for retraining, workplace modifications, or gradual reintegration into the workplace.
Death Benefits
Financial support for dependents in the event of a fatal workplace incident.
Cover at a glance
Mandatory cover for all Australian employers with staff
Wage replacement for injured or ill employees
Cover for medical expenses and rehabilitation costs
Lump sum payments for serious injury or permanent impairment
Return-to-work and retraining support option
Death benefits for dependents following a workplace incident
Who needs it?
Workers’ Compensation Insurance is mandatory for any employer in Australia, including those who:
Employ staff (full-time, part-time, casual, or apprentices).
Hire deemed workers, such as contractors in certain roles, depending on state regulations.
Operate in industries with physical or mental health risks
Key points to remember
Penalties
Employers who fail to insure eligible workers can face significant penalties.
Varying Coverage
Definitions of coverage can differ, especially for contractors, volunteers, or gig workers. It’s essential to consult your state’s regulator (e.g., WorkSafe Victoria or icare NSW) to confirm eligibility.
