COMPULSORY INSURANCE AGAINST ACCIDENTS AT WORK
WHICH WORKERS ARE SUBJECT TO INSURANCE
The employer is obliged, at his own expense, to take out insurance against accidents at work for certain workers whose nature of work puts their life and health at risk (art. 52, para. 1 of the Safety and Health at Work Act). The conditions and procedures for taking out insurance are laid down in the Decree on the Compulsory Coverage of Workers and Employees against Accidents at Work.
By written order, after consultations with the occupational health services and the working conditions committee/group, and according to the assessment of risk, the employer determines which workers are eligible for coverage. Under art. 2, para. 1 of the above decree – Subject to compulsory insurance are workers and employees involved in the core and auxiliary activities of a business categorized as engaging in an economic activity that puts workers at risk for work accident equal or higher than the average for the country. The employer must issue an order, taking into account the occupational accident quotient. This quotient is fixed annually for all economic activities by order of the Minister of Labor and Social Policy, issued on the basis of statistical data on occupational accidents during the past three years, promulgated in the State Gazette.
Order № RD-06-44 of 22.11.2022 on the occupational accident quotient by economic activity to be applied in 2023 by the Minister of Labor and Social Policy details the economic activities and their responding occupational accident quotients, including (but not limited to) the following activities: manufacturing of pharmaceutical substances and products, beverages, food products, furniture, chemical products, metal items, construction activities, specialized construction activities, postal and courier services, land and water transport, cargo warehousing and ancillary transport activities, mining of metal ores and coal, etc. If the employer engages in one of the economic activities referred to in the order of the Minister, he must insure the respective workers or employees. The insurance premium is paid by the employer and not deducted from the remuneration of the insured workers.
The compulsory insurance covers the following occupational accident risks:
- Death of an insured person
- Permanent disability
- Temporary disability
This insurance does not cover accidents occurring on the way to or from work (so called cases treated as an occupational accident) except when expressly stipulated in the insurance contract and upon the payment of an additional premium.
The insured amount under the compulsory insurance against accidents at work is determined based on the gross monthly salary of the insured workers at the time of taking out the insurance. The insured amount set out in the insurance contract between the employer and insurer is the limit of liability (upper limit) within which the insurer is liable for work injury damages. The minimum amount of coverage is 7 (seven) times the gross annual salary of the respective worker.
The amount of the claims paid is determined as follows:
- In the event of death of the insured worker, the full amount of damage is owed for the respective worker, set out upon concluding of the insurance contract (the minimum amount of coverage is indicated above).
- In the event of permanent disability, the damage amount is a percentage of the insured amount for the respective worker, equal to the degree of the disability, established by the competent authority (Local or National Work Capability Assessment Committee). If the worker has been assigned degree of disability prior to the work accident, it is not taken into account.
- In the event of temporary disability, the damage amount is a percentage of the gross monthly salary of the worker on the basis of which the insurance is taken out, covering each month of temporary disability based on the duration of the disability:
- Over 10 up to 30 calendar days: - 3 %;
- Over 30 up to 60 calendar days - 5 %;
- Over 60 up to 120 calendar days - 7 %;
- Over 121 calendar days - 10 %.
The damage amount is owed to the insured person and in the event of death - to his/her legal heirs.
RIGHT OF CLAIM AGAINST THE INSURER
Under the compulsory insurance against accidents at work, the insured worker and his/her heirs, respectively, have the right to file a claim against the insurer before the expiration of the 5 (five) year limitation period from the date on which the insured event occurred.
IMPORTANT! Despite that the employer takes out insurance and is a party to the insurance contract paying the premium, he/she has no right to file a claim against the insurer in case the latter refuses to pay compensation to the injured worker or his/her heirs for any reason. According to settled case-law, despite that the compensation paid by the insurer under the insurance reduces the amount of damage owed by the employer for work accidents, the compulsory insurance does not cover the professional liability of the employer and the insurer fulfills his own obligation arising from the contractual relationship under the policy and not the employer’s obligation under art. 200 of the Labor Code.
This is why, it is important that in the event of a work accident, the employer guides and assists the injured worker or his/her heirs in claiming compensation from the insurer under the compulsory insurance against accidents at work, thus reducing the amount owed by them. Also, if they want to minimize losses, resulting from their obligation to pay compensation to the injured worker or his/her hairs, the employer must conclude a separate insurance contract covering their liability under art. 200 of the Labor Code, with a sufficiently high limit of liability for one event.
This article has been prepared for the purposes of general information only and does not constitute legal advice with respect to any particular subject or situation. For specific legal advice you should contact an attorney-at-law. Stoeva, Tchompalov & Znepolski is not responsible for any legal action undertaken on the basis of the information contained herein.