LIABILITY INSURANCE
Workers’ compensation definition
Workers’ compensation is insurance or a statutory scheme that provides medical, income and compensation benefits for work-related injury, illness or disease.
In practice, this means workers' compensation provides benefits in the form of medical assistance, income replacement and compensation in respect of an occupational injury, illness or disease. This term gives insurers, brokers, reinsurers and risk managers a common way to discuss the concept when reviewing policies, claims, regulation or market data.
This term is especially useful in employee benefits, workplace protection and statutory insurance systems. It helps assess legal responsibility, claim response and protection against third-party or employee claims. It also helps users compare how insurance is structured, regulated, priced or claimed across different markets.
Workers’ compensation is closely related to employers’ liability, employee benefits, occupational injury and statutory insurance. Linking these concepts together helps build a clearer glossary structure and gives readers a stronger understanding of how individual insurance terms connect within wider international insurance practice.
At a glance
- Used in
- Employee benefits, workplace protection and statutory insurance systems.
- Purpose
- Helps assess legal responsibility, claim response and protection against third-party or employee claims.
- Important because
- Clear definitions support better comparison of insurance products, market practices and regulatory requirements across jurisdictions.
- Related terms
- employers’ liability, employee benefits, occupational injury and statutory insurance.
Example of workers’ compensation in insurance
An employee suffers an injury while carrying out their job. Workers’ compensation insurance may provide benefits or compensation according to the rules of that jurisdiction.