What is the Employer’s Liability in Workmen’s Compensation Insurance in UAE and Scenarios where it is applicable?

Introduction

An employer in the UAE with people working in their organization must be liable to ensure the employees’ well-being. The employees provide their labour and time to help the company reach its desired stature. Hence, following the Labour Law in the UAE, workmen’s compensation insurance includes the employer’s liability toward employees. This means that the insurance will cover diverse expenses on behalf of the employer and help them bear the responsibility of the workers. 

However, sometimes employers may need to bear legal expenses as well. Although companies sometimes opt for standalone employee liability insurance. In this blog, we’ll explore employer’s liability in workmen’s compensation insurance in UAE and scenarios where it is applicable

What is Employer’s Liability in Workmen’s Compensation Insurance in the UAE?

Workmen’s compensation insurance is a way to create a safe and supportive work environment for employees and a peaceful ambience for employers. However, discussing the clear definition of employer’s liability coverage in workmen’s compensation insurance is important. 

Across industries, employer’s liability coverage helps employers avoid expenses for legal lawsuits and penalties in cases of occupational accidents. Thus, with extra protection, employers’ liability coverage ensures that a business can avoid unexpected hurdles due to potential legal liabilities or challenge packages

Employer’s Liabilities in Workmen’s Compensation Insurance: The Types

In these insurance package, the benefits that employers mostly receive to meet their liabilities are as follows:

Court Cost and Legal Fees

Many industries have specific court laws related to workplace injuries. So, if the court holds the employer liable for any damage or loss related to work-related accidents, employer liability coverage can help the employer avoid the hassles easily. 

Legal Liability Coverage:

Sometimes, the family members of employees affected by workplace accidents file lawsuits against the employer, citing their negligence or inability to provide a safe workplace. Liability coverage under workmen’s compensation insurance protects them from potential hassles that may arise from these issues.

Availing Employer’s Liability Coverage: Challenges and Solutions

Not Enough Clarity about Coverage Limits:

Many insurance plans do not provide enough clarity about coverage limits, which creates doubts for employers. Exclusions and limited coverage sometimes demotivate them. As a result, they need help to avail of the right insurance plan with employer liability coverage at the right time.

To ensure proper coverage, one must stay updated on the latest workmen’s compensation insurance plans that address employer liability. Trusted providers like CoverB offer valuable insights into diverse coverage options. 

Variations in Regulatory Frameworks in UAE

There are various jurisdictions and regulatory frameworks, including federal law, free zones, etc. So, sometimes, it becomes tiresome for employers to find the right framework to go with for workmen’s compensation insurance covering employer liability. 

This problem can be solved by taking the help of legal advisors and gaining knowledge from trusted resources online. 

Consequences of Not Having Employer’s Liability Coverage

• Without employer’s liability coverage, employers are susceptible to the high risk of stressful lawsuits filed by affected employees’ families or third parties in workplace accidents, non-compliance with safety laws, etc. 

• Reputation damage may occur for employers if they are accused of being unable to stop workplace accidents and don’t have employer’s liability coverage protection. Employers may even lose business contracts if such a case happens.

• No employer wants to face the problem of losing the right talent. The workforce is the heart of a company, so ensuring they are satisfied with the right protection will help them stay loyal to the company.

• Without employer’s liability coverage under workmen’s compensation insurance, an employer may have to bear the legal hassles of paying medical expenses, repatriation costs, and other related expenses all by themselves, resulting in a huge amount of stress. 

• If the employer thinks of taking legal steps in any unwanted circumstances of work-related incidents, they may have to bear high court fees and legal costs without liability coverage under workmen’s compensation insurance.

Final Thoughts

So, in the long run, it is evident that employers in the UAE must own standard workmen’s compensation insurance that includes employer’s liability coverage for their own sake. The coverage limit and other conditions must be aligned with the nature of the business and the risk level of the industry. Even if an employer has to pay an initial high premium for the insurance, they should not step back, as it will ensure benefits in the long term. 

Connect with experts at CoverB today for tailored insurance service for all your needs!