Understanding Non-Coverage For Workers Compensation And Income Protection

What is not covered by workers compensation?

There is no such thing as a complete, cover-everything type of insurance policy. No matter how comprehensive a policy, there are always exclusions and limitations. Workers compensation, or Workcover in Australia, is also designed that way. For many earthmoving owner-operators, this insurance policy is a must as it provides needed protection in the event of injury or illness relating to their work. While this workplace policy is lauded for the support given to good working employees in the earthmoving industry, there are still certain exclusions and limitations that must be taken into account. So, what is not covered by workers compensation?

Understanding Workers Compensation

Before going to the bottom of what’s excluded from workers compensation (Workcover) in Australia, it is important to understand what it covers, too. Offering a safety net for employees to fall back on in the event of work-related upheavals, workers compensation in Australia literally covers all employees excluding volunteers, casual workers, and independent contractors. In most cases, project-based employees may not be covered depending on state implementing guidelines. When a bobcat driver for a construction company, for instance, gets injured whilst on site, he or she is entitled to the following:

  • Paid sick leave (as replacement income)
  • Medical care (including rehab)
  • Retraining costs (if needed)
  • Permanent injury compensation (disability – partial or permanent)

Should the workplace accident result in the death of the said bobcat driver, the spouse or minor child/dependents left behind may claim survivor benefits. Workers compensation is mandated by the Australian government and legally operating companies must provide such a policy as protection for their employees as well as for the welfare of the business. Be reminded that once an employee claims workers compensation for an injury or illness, he or she can no longer sue the employer.

Exclusions and Limitations

Workers compensation, though required by the government, is administered in more ways than one. Different states and territories have their own implementing rules and guidelines on how benefits are applied. In ACT, Northern Territory, Western Australia and Tasmania, the role of underwriting of the policy rests solely on private insurers. In Victoria, South Australia and NSW, private insurers operate on behalf of the government. It is only in Queensland that the state government operates this insurance scheme. So limitations are often related to how policies in each state and territory mentioned are administered.

Before moving on to certain exclusions of the workers compensation Australia policy, it is important to note that “work-related” does not only mean injuries incurred within the premises of an earthmoving company. It can also be on a construction project site or on the road or somewhere else wherein the act done by an employee is within his scope as an employee of the earthmoving company. While workers compensation covers injuries regardless of who is at fault, the following instances of on-the-job injuries are deemed NOT covered by the policy:

  • Injuries due to intoxication
  • Injuries due to the use of illegal drugs
  • When inciting a fight
  • When done with the intent of committing a crime
  • When the act violates company policy
  • Self-inflicted injury
  • Undisclosed chronic illness

Remember – workers compensation does not cover you at home, on weekends or on holidays.

Many workers compensation policies also do not cover mental trauma or injuries resulting from natural disasters. These aspects, however, are subject to the implementation rules and guidelines in each state and territory.

Bottom line is: Not all workers compensation delivers the same benefits to earthmoving employees. Even though the main purpose is to protect employees and employers, an earthmoving owner-operator may face certain exclusions and limitations detrimental to his or her recovery or livelihood. Financial experts further recommend that employees obtain income protection insurance as a defense for any untoward incidents regardless if covered by workers compensation or not. To learn more about earthmoving owner-operator income protection insurance, call our hotline or send us a request for a free quote.