What is Employee Compensation Insurance?

Employee Compensation - EC Insurance Hong Kong

Employee Compensation (EC), also known as Employer’s Liability, is one of any new company’s first insurance.

As an Employer, you got a liability if one of your staff suffers an injury or contracts illness in the course of his duties. Thus, whatever your staff is a full or part-time worker, contractor, sub-contractor, free-lance etc…

For most countries, this is mandatory insurance that comes with the basic insurance package (together with Property All Risks and Public Liability) you will subscribe to when you start your business.

The insurance will cover wages and salaries during sick leaves, medical costs, and permanent disability/death compensation.

What is covered?

Employee Compensation Insurance in Hong Kong covers:

  • 80% of wages and salaries for the period of sick leave related to the work accident
  • Up to medical expenses HKD 300 per day / injured staff
  • Compensation for permanent disability after assessment by the labour department
  • Up to 84 months of salary in case of death

Depending on your insurer, you can have some free extensions such as:

  • Business Trips
  • Social activities
  • Trips between employee home and his workplace
  • Delivery services

What should you know?

Employee compensation is strictly mandatory in Hong Kong under chapter 282 of the laws of Hong Kong. Rules and obligations are defined and organised by the Employees’ Compensation Ordinance.

Any company must have an Employee Compensation Notice of Insurance (ECNI) that the business can immediately present to any Labour department officer in case of control.

Minimum insurance cover should be HKD 100million for any company with less than 200 employees. And HKD 200million for any company with more than 200 employees.

An employer who fails to comply with the Ordinance to secure an insurance cover is liable to prosecution and, upon conviction, to a maximum fine of $100,000 and imprisonment for two years.

Employee Compensation is not a health insurance!

It cannot cover any cost in case of non-work related injury or sickness.

Good to know!

Employee Compensation in Hong Kong is the last section of Office/Shop package and can be included as an option.

Premium would be fixed as rate applied to your annual wages and salaries.



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