What Happens If I Don’t Have Workers’ Compensation Insurance?

Workers’ compensation insurance is an important one for all employees. To find out why, it’s important to understand exactly what workers’ compensation insurance is. For starters, you may be surprised to know that workers’ compensation insurance is compulsory throughout Australia for all employers with employees. This also may include contractors and sub-contractors. Workers’ compensation insurance is a fundamental insurance to run your business. Let’s delve a little deeper into why workers’ compensation insurance is so important.

What is workers compensation insurance?

Workers’ compensation insurance is designed to cover the costs associated with a workplace injury or illness. If an employee is injured, falls ill or suffers from mental illness due to work, it’s the responsibility of the employer to support their employees with associated costs. The costs associated with a workers’ compensation claim can be very costly, even for a relatively minor incident.

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.

Do I need workers’ compensation insurance as a sole proprietor?

As a sole trader, you can’t cover yourself as an ‘employee’ with workers’ compensation insurance. However, it is important for you to consider an alternative insurance to cover yourself if you were to fall ill or injure yourself at work. Sole traders should consider  accident and sickness insurance. This policy will compensate you for loss of revenue while you recover. Without some kind of insurance in place, if you were to fall ill or injure yourself you could be in serious financial trouble and be forced to return to work before you have fully recovered. Accident and sickness insurance will offer you similar peace of mind that workers’ compensation offers employers with employees.

Is employers’ liability insurance the same as workers’ compensation?

Employers’ liability insurance is part of workers’ compensation and is often referred to as part 2 of workers’ compensation insurance. Workers’ compensation insurance will cover the medical expenses and loss of wages associated with a workplace injury or illness. Whereas employers’ liability insurance (part 2 of workers’ compensation) is designed to cover legal expenses if an employee were to sue due to negligence causing their injury or illness. After a successful claim with employers’ liability insurance, the employer can add a clause releasing them from any further liability to the injury or illness in question.

How much is workers’ compensation insurance in Australia?

The cost of your workers’ compensation insurance will vary depending on a number of factors. These include the number of employees you have, the industry you are in, the type of work you do and any prior workers’ compensation claims you may have had. Your rate will then be calculated depending on the risks and historical claims information associated with your specific industry. In general, the cost of your insurance will be your wages estimate multiplied by the industry gazette rate. In most cases, your state or territories workers’ compensation scheme will allocate a rate for each industry. Contact us for your workers’ compensation quote today.

What is covered under workers’ compensation insurance?

Workers’ compensation insurance covers a number of situations, these include lost wages, medical expenses, ongoing costs associated with recovery and rehabilitation, legal costs and funeral costs.

There are also a number of scenarios that workers’ compensation won’t cover. These include wages for a replacement employee, fines and penalties, safety improvements and third-party injury.

What happens if I don’t have workers’ compensation insurance?

If you are an employer with employees, you need workers’ compensation insurance by law. If you don’t have workers’ compensation insurance, you could face a costly fine or in some cases jail time. Each state and territory have their own laws and penalty rates for not having workers’ compensation insurance. These fines can be rather costly and could cost you your business. Not having workers’ compensation insurance not only puts you at risk of losing your business but poses a risk to your employees’ safety and well-being. Don’t take the risk and make sure you take out workers’ compensation insurance.

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.