What is Employee Compensation Insurance?

Employee Compensation

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

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

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

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

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

  • Business Trips
  • Social activities
  • Trips between employee home and his work place
  • 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 be in possession of an Employee Compensation Notice of Insurance (ECNI) that can be immediately presented to any Labour department officer in case of control.

Minimum insurance cover should be HKD 100million for any company of less than 200 employees. And HKD 200million for any company of 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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  • Employee Compensation

Basics of Employee Compensation in Hong Kong

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In Hong Kong, only one insurance is strictly mandatory for every employer, whether corporation or individual. It is called Employee Compensation and it is regulated by the Employee Compensation Ordinance written in the Laws of Hong Kong and enacted by the Labour Department. Failing to comply with this legal code can result in severe financial penalties for your business. What covers the Employee Compensation? It is insurance that covers the liability of the employer in case one of the employees get injured/a disease or died in the course of his employment. In other [...]