What is workers’ compensation insurance in singapore? In Singapore, workers’ compensation insurance is a type of insurance that helps employees who get injured or fall sick because of their work. It is part of the government’s efforts to protect workers and ensure that employers take responsibility for workplace safety. This insurance helps cover medical costs and lost wages when a worker is hurt while doing their job.
The law that governs this is called the Work Injury Compensation Act (WICA). This law allows employees to claim compensation for work-related injuries or diseases without having to sue their employer. It offers a quicker and simpler way to get help after an accident.
Employers in Singapore are required to buy workers’ compensation insurance for certain groups of employees. Even if the law doesn’t require insurance for some employees, all workers are still covered under the WICA. This means employers are still legally responsible to pay compensation if something happens on the job.
Who Needs Workers’ Compensation Insurance in Singapore?
Not every worker in Singapore is required to be covered by insurance, but the law does require it for certain categories. Employers must buy insurance for:
All manual workers, regardless of salary
Non-manual workers earning $2,600 or less per month
Manual workers include people who do physical work like construction, cleaning, factory work, or delivery. These jobs have higher risks, so insurance is mandatory. For non-manual workers, if their pay is under the limit, employers must also insure them.
Even if a worker earns more than $2,600, the employer may still choose to buy insurance. It is a smart way to protect the company from high medical bills and loss-of-income claims. Some employers choose to buy insurance for all employees, even if it’s not legally required. This shows responsibility and builds trust with workers.
Foreign workers are also covered under the WICA, including those with Work Permits or S Passes. This helps ensure that all workers, regardless of nationality, are protected.
What Does Workers’ Compensation Insurance Cover?
Workers’ compensation insurance in Singapore provides several types of support when an employee is injured at work or suffers from a work-related illness. It covers:
1. Medical Expenses
The insurance pays for hospital stays, doctor visits, surgery, medication, and other treatments. This includes follow-up visits and rehabilitation.
2. Lost Wages
If the worker cannot return to work right away, the insurance pays a part of their salary for the time they are on medical leave. This helps the worker continue to support themselves and their family.
3. Permanent Disability Compensation
If a worker suffers a permanent injury, such as the loss of a limb or eyesight, the insurance provides a lump-sum payout. The amount depends on how serious the injury is.
4. Death Compensation
If a worker dies because of a work accident, their family will receive compensation. The employer is also responsible for paying for funeral expenses.
5. Work-Related Diseases
Some illnesses are caused by long-term exposure to chemicals, dust, or noise at work. These diseases are also covered under workers’ compensation insurance.
This coverage gives peace of mind to both employers and employees. It ensures that workers get the care they need and that employers don’t have to bear large costs all at once.
How Are Claims Filed Under WICA?
One of the best things about Singapore’s system is that it avoids long legal battles. A worker does not need to sue their employer to get compensation. The process is handled through the Ministry of Manpower (MOM), which provides clear steps for making a claim.
Here’s how it usually works:
Step 1: Report the Accident
The employee must tell their employer about the injury or illness as soon as possible. The employer should file an incident report with MOM, especially if the injury results in more than three days of medical leave or if the worker is hospitalized for at least 24 hours.
Step 2: Seek Medical Treatment
The worker must visit a doctor to receive treatment and a medical report. The report will explain the type of injury, the estimated time off work, and whether there is permanent damage.
Step 3: File the Claim
The employee or employer submits the claim through the MOM website. The form includes details about the accident, medical certificates, and other supporting documents.
Step 4: MOM Reviews the Claim
The Ministry of Manpower will review the documents and decide the amount of compensation. If needed, they may ask for more information or conduct an investigation.
Step 5: Receive Compensation
If the claim is approved, the employer (or their insurance company) will pay the amount to the worker or their family.
This system makes the process faster, simpler, and more affordable for workers. It also gives employers a clear set of guidelines to follow.
What Happens If an Employer Does Not Buy Insurance?
It is a legal offense for employers not to buy workers’ compensation insurance when it is required. If an employer fails to provide insurance for workers who must be covered, they can face serious penalties.
These penalties may include:
Fines of up to $10,000
Jail time of up to 12 months
Being barred from hiring foreign workers in the future
More importantly, the employer is still responsible for paying all compensation costs, even if they don’t have insurance. This can be financially damaging, especially if the injury is severe or leads to death.
Employers should always make sure their insurance is up to date and that all required workers are covered. It is also wise to keep proper records of insurance policies and claims, in case the Ministry of Manpower requests them.
Why Is Workers’ Compensation Insurance Important?
Workers’ compensation insurance plays an important role in keeping workplaces fair and safe. It helps both employees and employers in many ways.
For employees, it provides protection. If they get hurt, they know they will receive medical care and support. They don’t need to worry about paying for treatment or losing their income. This brings peace of mind to many workers, especially those in high-risk jobs.
For employers, insurance reduces the financial burden of workplace injuries. If a serious accident happens, the cost can be very high. Medical bills, lost wages, and legal fees can put a business at risk. Insurance helps manage these costs and protect the company’s future.
The law also encourages employers to create a safe working environment. When workers feel protected, they are more likely to stay loyal and productive.
How Much Does Workers’ Compensation Insurance Cost?
The cost of insurance depends on a few things:
The type of work the employees do
The number of workers insured
The company’s past accident records
High-risk jobs, like construction or factory work, usually cost more to insure. Jobs that involve desk work or low physical risk are cheaper to cover. Insurance companies may also give better rates to companies with good safety records.
Employers can contact several insurers to compare prices and choose the best policy. In Singapore, many insurance companies offer workers’ comp plans that meet WICA requirements. Some businesses also use insurance brokers to help find the right coverage.
What Is the Difference Between WICA and Common Law?
In Singapore, workers have two options if they are injured at work:
File a claim under WICA
Sue their employer under common law
WICA is faster and simpler. It doesn’t require hiring a lawyer, and the process is handled by MOM. It is the best option for most workers, especially for minor and moderate injuries.
Under common law, the worker must prove that the employer was at fault. This can take a long time and may involve going to court. However, if the worker wins, the compensation may be higher than what is allowed under WICA.
A worker cannot file claims under both systems for the same injury. Once they choose one, they cannot switch. Most workers prefer WICA because it is easier and more direct.
What Can Employers Do to Improve Workplace Safety?
Buying insurance is important, but preventing injuries is even better. Employers can take steps to reduce accidents and protect their workers.
Here are a few things companies in Singapore can do:
Train workers on safe work practices
Provide proper safety gear and tools
Inspect workplaces regularly
Offer health and safety workshops
Encourage workers to report hazards
Keep first aid kits and emergency plans ready
By building a culture of safety, businesses can lower their insurance costs and build stronger teams.
Conclusion
Workers’ compensation insurance in Singapore is a key part of protecting employees and supporting responsible business practices. It ensures that workers who are hurt on the job get the medical care and wage support they need, without having to fight long legal battles.
Under the Work Injury Compensation Act, many employers are required to buy insurance for their employees, especially those in manual or lower-wage roles. Even when insurance is not required, it is often a wise choice to protect the business from unexpected costs.
The system is designed to be fair, fast, and efficient. It helps injured workers recover while giving employers a clear path to follow. By understanding how workers’ compensation insurance works, both employees and employers can stay safe, protected, and prepared for the future.
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