Employees' Compensation insurance
In life, accidents are inevitable. No matter how thorough the plan or careful the process, people make mistakes. Unfortunately, when those accidents and mistakes happen at work, employers often find themselves on the line. Employee Compensation Insurance (ECI) protects your business from the potential repercussions of such accidents.
Depending on your industry and business, ECI can be either an add-on to your office package insurance or a separate policy in its own right. Tell us more about your business and we will write a policy to suit you.
What is Employee Compensation Insurance?
Employee Compensation Insurance (ECI) is an insurance policy that covers an employer’s liability when a member of their staff suffers injury or illness while working. The policy can cover full- and part-time staff, contractors, sub-contractors or freelance staff, in companies across every industry.
ECI is a legal requirement for all employers in Hong Kong. It is notorious for being difficult to obtain, with insurers sometimes reluctant to offer the cover. However, at Howden, our strong relationships with insurers and our skill in negotiating claims mean we can help insure even the most complicated cases.
What does good Employee Compensation Insurance look like?
If an injured staff member makes a claim against their employer the results can be ruinous – especially in more hazardous industries like construction, security, or manufacturing. A comprehensive policy can mean the difference between a quick resolution and a lengthy court case.
A good policy should:
Comply with the Employees' Compensation Ordinance
As ECI is a legal requirement, it is vital that your policy meets the criteria of the legislation.
Cover all classes of employee
This includes proper provision for contract workers, sub-contractors, and self-employed consultants.
Include healthcare services
Healthcare for affected employees can help them get back on their feet sooner, avoiding prolonged sick leave and increasing goodwill.
A good insurer will:
Know your industry inside-out
An underwriter (and broker) who knows your industry will understand the risks you face and make sure that your policy covers them.
Have an effective claims team
Once you make a claim, the costs can escalate dramatically over time. A proactive claims management plan is essential to avoid delays and process the claim quickly, to avoid those escalating costs.
Provide a competitive solicitor
More and more ECI claims are going to litigation, so employers need a good lawyer on their side.
Have a strong reserve strategy
ECI claims can take a long time to settle. It is important that the insurer establishes the right estimate of costs at the outset to avoid the claim running out of control, leading to disputes and recriminations.
In ECI claims, a quick resolution is vital to keep costs down. Delays mean escalating settlement costs - and more sick-days
What can Howden offer?
With a team of local specialists and an international network of industry expertise, we can create bespoke policies that are tailored to your business needs. Our relationships with A-rated insurers means we can secure favourable terms for our clients. We are also always on your side, handling and negotiating claims with insurers on your behalf, shortening the process and getting your people back on their feet more quickly.
We can also offer value-added services including:
ECI claims seminars
The claims process is complicated, with forms to be sent to the Labour Department at specific times and evidence to be provided to the insurers. We offer on-site training to explain it all so that you know exactly what to do when you need to make a claim.
Claims notification app
Our claims notification app helps to speed up the claims process, allowing you to report a claim immediately. It also enables you to complete statistical analyses on your claims and loss history.
Work rehabilitation and risk management
For some clients, we can offer programmes to help affected employees return to work. Our risk management programmes offer assessments and risk reduction advice from an insurer's perspective. With experience handling ECI claims across many industries, we know the risks that are most likely to result in claims - and can help you mitigate them.
We regularly review and monitor the claims reserves, or estimates, set by the insurer. These estimates directly affect your renewal premium, so it is essential that insurers do not overestimate the cost of a claim to drive up the premium.
- Cover for sub-contractors.
- Cover for self-employed contractors/consultants
- Cover for “to and from work”
- Cover during extraordinary weather conditions (i.e. typhoons and rainstorms)
- Covering employees temporarily working overseas
- Nominated loss adjuster or solicitor
- Healthcare management service
A word to the wise
Beware premiums that seem too good to be true. Unscrupulous insurers sometimes enter the market to make quick money, undercutting the competition and attracting clients with cheap premiums. However, their reserves are too low to cover the costs of claims, and as the losses mount they are forced to withdraw – or even go insolvent. In the past, this has left businesses with few options – on the line for any ongoing claims and forced to pay over the odds for last-minute cover.
Even if the cheap premiums don’t result in insolvency, budget insurers don’t invest in claims management processes or systems. As a result, claims are delayed and costs escalate. This doesn’t just affect the client for the one claim – it impacts their whole claims history, increasing the cost of premiums in the future, too.