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Changes to your WIC Insurance, and What It Means.

With effect from 01 Jan 2020, there were updates made to WICA (Work Injury Compensation Act), and all Insurers have to update their insurance policies in accordance with the changes.

Whilst we have shared recently on the above, we thought to help by expanding on some details, highlight on potential issues, as well as advise you on how to reduce your insurance premiums!

To recap, here are the 4 key changes to the WICA Act are:

  1. Changes in compensation and medical expenses limits
  2. Expansion of mandatory insurance coverage of non-manual employees
  3. Compensation to include light duties
  4. Compulsory reporting for all (work-related) medical leaves or light duties~

  • Approximate 10% increase in Death and Total Permanent Incapacity
  • 25% Increase in Medical Expenses

Do note that WIC insurance for all manual employees is
mandatory regardless of salary, and it is a must to buy WIC Insurance for all non-manual employees earning less than $2,600/month.

Failure to provide adequate insurance is an offense carrying a fine of up to $10,000 or jail of up to 12 months, or both.  

You might have been familiarised with the above since they have been in effect for a while now – however, you should also note that there are a few new changes with effective from 1st September:

  • Only approved Insurance Companies will be allowed to issue WIC Insurance
  • It will be compulsory to report all employees’ medical leaves, or when they are assigned light duties.
  • Employees on light duties due to work injuries will be compensated for their loss of earnings based on their Average Monthly Earnings (AME).
  • So as to expedite and streamline the compensation process for all parties, the Employer’s WIC Insurance will be the default go-to policy for claim. What happens next is that the employer’s WIC Insurers will process these claims(no matter if it’s death, temporary or permanent incapacity claims), and seek damages if the 3rd Party found to be the cause of injury.
  • There will be a shared portal between Insurers of their client’s past claims records, which may result in a higher premium difference than before.

How Will the New Premiums Be Calculated?

The new rates will be calculated based on:

  • Employees’ scope of work and occupations
  • Claims experience (if any)
  • Previous payroll submission, calculated at end of yearExpected premium increment will be about 50-300%. E.g:

Important Notes on Your Project Insurance

As an employer, your project WIC insurance will be discontinued after 1st September, and will be likely replaced by Liability Coverage. It might subsequently be included instead in your Construction All Risk (CAR) policy, or in a separate Liability coverage.

The blanket WIC insurance covered by PUB and LTA projects, will also be discontinued!

Our Suggestions

With all these changes to be in place, we strongly advise all Construction industry employers to purchase Liability insurance, to cover themselves.

In order to minimize the increment in your insurance premiums, it is crucial that you continue to maintain a high safety standard to reduce injuries. Also, you should consider paying out of pocket for smaller claims, so as to not affect your renewal rates for next year.

At AWG Insurance Brokers, we are committed to continue your journey with you. Let us assist in reviewing your existing policy, and guide you on the next steps as necessary. Leave a message below, or call us at 6294 6688 for assistance!

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