Company Formation Why employment insurance is necessary?
According to Section 40 of the Employees' Compensation Ordinance, all employers (including contractors and sub-contractors) are required to take out insurance policies to cover their liabilities both under the Ordinance and at common law for injuries at work in respect of all their employees, irrespective of the length of employment contract or working hours, full-time or part-time, permanent job or temporary employment.
An employer who fails to comply with the Ordinance to secure an insurance cover commits an offence and is liable on conviction to a maximum fine of HK$100,000 and imprisonment for two years.
Apart from legal requirements, why do we need employment insurance?
The society is paying more attention to employment welfare at the present. As a result, the employers are required to purchase employment insurance and group medical insurance for their employees before they bid for tender, especially in cooperation with non-profit organizations and government agencies, including the physical therapy industry and security industry.
How to determine the premium of employment insurance
The premium of employment insurance is determined by series of risk assessments, including:
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The underwriting risks of different industries/ occupations
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Claims history of the employer concerned
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Occupational safety as well as risk prevention measures taken by the employer concerned
What document is needed for employment insurance
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Company information, including business registration certificate and/or certificate of incorporation
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Employees’ information (e.g. occupations, number of employees, actual earnings, usual work locations, full-time/ part-time, requirement to work or take business trips outside Hong Kong, etc.);
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Past claims records; and
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Recent MPF contribution records (eg. 3 months of records)
Compensation for death
Compensation in cases of permanent total incapacity
The amount of compensation in case of permanent partial incapacity is based on a percentage of the compensation payable for permanent total incapacity as is proportionate to the loss of earning capacity caused by the injury.
Medical expense
The daily maximum of medical expenses payable by the employer are as follows -
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The medical expenses for each day of stay in the hospital where an employee is given medical treatment as an in-patient in a hospital: 300 HKD
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The medical expenses for each day on which an employee is given medical treatment other than as an in-patient in a hospital: 300 HKD
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The medical expenses for each day on which an employee is given medical treatment both as an in-patient in a hospital and other than as an in-patient in a hospital: 370 HKD
Liability insurance
Liability insurance provides an insured party with protection against claims resulting from injuries and damage to other people or property. Liability insurance policies cover any legal costs and payouts an insured party is responsible for if they are found legally liable. With liability insurance, the risk of operation is finely defused.
Business insurance
We truly understand you might not have adequate time for risk management as all your best is already devoted to your business. We provide you with a package of all round insurance protection including employment insurance and liability insurance to help your business strive.
Feel free to contact our professional consultant for more informaion at 3575 6888!
