Insurance Policy to an Oganisation - Assignment Example

Insurance Policy to an Oganisation Executive summary This report aims to analyse the various benefits that an organisation enjoys from the employer liability insurance. The employer liability insurance is defined as simply an insurance policy which protects organisations from liabilities that arise from the fatality, injury or diseases to their respective employees that arise from workplace practices or conditions. The employer liability insurance is of great importance to an organisation in terms of minimising the compensation expenses of the organisation. Since the organisation is responsible for compensating when they suffer damages or injuries while on duty, the policy is vital in solving the situation on behalf of the company. 1.0 Introduction Employers have a huge responsibility over their employees. They have to ensure that working conditions set out for employees are safe. In most cases, large organisations have been successful in achieving their goals as a result of good working conditions created for their employees (Athman, 2008). This is due to the fact that employee get opportunities to maximize their potential hence delivering good results. Employers need to protect employees from injury at the workplace and the employer liability insurance comes in handy when an employee is injured at work. The insurance policy covers for any damages or injuries that an employee suffers while executing assigned duties and responsibilities in the workplace. This policy also covers for the damages that a spouse of the victim suffers for lacking the services that he or he would have enjoyed had not been the injury suffered by the victim at the workplace. In an organisation, working conditions may be okay but an employee happens to suffer an injury when in the process of conducting assigned duties and responsibilities as a result of his negligence (Bernice, 10). In such a situation, the employer is not liable for the injury suffered by the employee. In this report, the researcher will attempt to analyse and explain the benefits of employer liability insurance to an organisation. 1.1 Problem statement It is the responsibility of the employer to take good care of employees’ welfare. Organisations are required to ensure that employees are safeguarded from any injury or damage when performing assigned duties in or outside the organisation. In case an employee suffers an accident that injures or harms the employee either physically, emotionally or mentally when performing assigned duties, the employer is responsible for compensating the employee. Organisations therefore need to find ways of dealing with such a situation when it arises. The employer liability insurance is one of the best ways of dealing with the situation. The study will analyse the benefits of this insurance further. 1.2 Research aim and objectives 1. To define employer liability insurance 2. To define what it covers 3. To define what it does not cover 4. To define its benefits to an organisation 1.3 Research questions 1. What is employer liability insurance? 2. What does it cover? 3. What does it not cover? 4. What are the benefits of the insurance to an organisation? 1.4 Significance of the study This research study may be of great significance to employers as it may enable them understand the benefits of having the employer liability insurance. It may convince employers to take the insurance so that whenever employees suffer injuries when on duty it becomes easy for the company to solve the situation. The study may also make employees aware of their employer’s responsibility and their rights as employees. 2.0 Literature review In the literature review section, the researcher outlines the secondary information that was acquired from secondary sources. Most of the information that was recorded in this section was acquired from books, journals, internet websites and newspapers. 2.1 Definition of employer liability insurance Employers have the responsibility to care of all their respective employees when they are at work. If any case employees suffer injuries when on duty, their respective employers are supposed to take care of such a situation. In order to minimise this expense, organisations take up the employer liability insurance. The employer liability insurance is simply an insurance policy which protects organisations from liabilities that arise from the fatality, injury or diseases to their respective employees that arise from workplace practices or conditions (Austin, 2002). Regulations mostly recommend that all organisations should take up this policy. 2.2 What the insurance covers The insurance policy as discussed above it covers for any damages or injuries that an employee suffers while executing assigned duties and responsibilities in the workplace. This policy also covers for the damages that a spouse of the victim suffers for lacking the services that he or he would have enjoyed had not been the injury suffered by the victim at the workplace. The insurance policy also covers for damages or harm that an employee suffers from a service or product that is produced by the employer (Barry, 2000). In such a situation, the employer is held liable as a manufacturer and as an employer. The policy also covers for injuries that are suffered by family members as a result of the injury sustained by the victim (employee) and this in most cases is referred to as consequential bodily injury. 2.3 The policy does not cover In an organisation, working conditions may be okay but an employee happens to suffer an injury when in the process of conducting assigned duties and responsibilities as a result of his negligence (Bernice, 2004). In such a situation, the employer is not liable for the injury suffered by the employee. This is due to the fact that the employer has executed his duty in an exceptional manner by ensuring that the working conditions are safe and sound. Therefore, the insurance policy does not cover damages or injuries that arise as a result of employee’s negligence. 2.4 Benefits of the insurance policy to an organisation The employer liability insurance is of great importance to an organisation in terms of minimising the compensation expenses of the organisation. Since the organisation is responsible for compensating when they suffer damages or injuries while on duty, the policy is vital in solving the situation on behalf of the company (Betty, 2004). The employee that suffers injury does not claim compensation from the organisation but rather from the insurance company that the organisation has registered with. This enables the company’s operations not to be disrupted and they keep on flowing smoothly hence enabling the organisation to achieve its targets within the set time. It’s far much cheaper for the organisation when an employee is compensated by the insurance company that the organisation associates with rather than when the company is taking full responsibility of the injury suffered by the employee and his/her family members. 2.5 Example of dispute and claims under employer liability “Barry V Tesco” Barry in this case was the plaintiff and the defendant is Tesco Company (David and Diana, 2007). Barry was an employee of Tesco working in the stores section for almost 15 years. In his 15th year, shelves in the store he was working in fell on him and injured his leg. He was not able to walk for three months. Tesco being the employer of Barry knew that it was its responsibility to take good care of Barry until his full recovery. All damages that Barry and his family suffered were compensated by the company through the company’s employer liability insurance. 3.0 Research methodology In the research methodology section of the study, the researcher outlines the methods and procedures that were followed in the process of conducting the study. In order to have an effective research, it’s recommended that researchers should be very careful with the methods that they select. 3.1 Research philosophy In this research study, the research philosophy that was applied is the positivism research philosophy. The research philosophies selected in most studies outlines the research strategies and approaches that are applied in the studies (Faith and David, 2006). There exists sufficient secondary data for the topic at hand and this is the reason why the researcher chose the positivism research philosophy. This philosophy advocates for the use deduction research approach due to sufficient literature review on the topic at hand. 3.2 Research approach As discussed above, the research approach that will be applied in this study is the deduction research approach. This approach is applied in the study since there is enough secondary data that can be used in this study unlike when the induction approach is applied. 3.3 Research design The research design simply refers to how the study will be conducted whether it will descriptive in nature or not (Fukuyama, 2002). The researcher in this study selected the descriptive research design as it was the best design to answer the questions what, how and when. 3.4 Research strategy There are two types of research strategies that are applied by researchers when carrying out their studies. These strategies are the qualitative and the quantitative research strategies (Gregory 9). Some researchers apply both strategies when carrying out their studies. In this study, the researcher will apply the qualitative research strategy. This strategy was selected since the research design that was selected is descriptive in nature. 3.5 Population, sample and sampling technique The population for this study was a total of 10 respondents. This number was deemed fit due the number of resources availed and the deadline for the study. From the 10 respondents, a sample of 8 respondents was selected. The sampling technique that was applied by the researcher to select the sample for the study is the random sampling technique. This technique is appropriate since it gives employees equal chances of being selected and in most cases minimises chances of bias when selecting a sample for any study. 3.6 Data collection methods Data is the foundation of every research study. In order for a researcher to make conclusions and recommendations that are logical, valid and reliable, he or she needs to have sufficient data (Terry, 2000). Researchers need to select data sources that will enable them acquire appropriate information for responding to the research questions and meeting the objectives of the study. In this research study, the researcher sourced secondary data from secondary sources that are books, journals, newspapers and internet sources. The primary data for the study was sourced from the open ended questionnaires that were distributed to the respondents selected for the study. 3.7 Data analysis techniques The data that was acquired from the respondents was well edited, recorded and analysed. The information was recorded in pie charts, tables and bar graphs. The researcher applied the qualitative tools to closely analyse gathered information in order to make conclusions and recommendations that could be relied on and that are valid and logical. 4.0 Research findings and analysis In this chapter of the report, the research outlines the findings that are the responses of feedback of respondents on the research questions outlined in the questionnaires. The findings were recorded and closely analysed by the researcher in this section of the study. 4.1 Personal details 4.1.1 Response rate The researcher distributed questionnaires to a total of 10 respondents. The guidelines for answering the questionnaires were outlined in questionnaires and respondents who filed to answer the questions as expected had their questionnaires nullified and classified as no responses. From the 10 respondents, only two of them failed to fill the questionnaires as expected. Figure 1: Response rate Category Responses Percentage Responses 8 80% No responses 2 20% Total 10 100% 4.1.2 Age The researcher in this study realised that the importance of opinions and views of both old and young respondents. Therefore, he did not discriminate against when distributing questionnaires to the target respondents. The respondents between 18-26 years were 3, those between 27-40 years were 4 and only one respondent was above 40 years. 2 respondents failed to answer questions appropriately and therefore were nullified. Figure 2: Age of respondents 4.2 Findings of research questions 4.2.1 What is employer liability insurance? The respondents that participated in the study were aware of what employer liability insurance means. The employees whose questionnaires were nullified are the only ones that were viewed as not to understand the meaning of employer liability insurance. Figure 3: Responses on the definition of employer liability insurance Respondents that are aware of the meaning of employer liability insurance argued that, “The employer liability insurance is simply an insurance policy which protects organisations from liabilities that arise from the fatality, injury or diseases to their respective employees that arise from workplace practices or conditions. Regulations mostly recommend that all organisations should take up this policy”. 4.2.2 What the insurance covers The respondents argued that the insurance policy covers injuries or damages that an employee suffers while on duty. Some of the respondents argued that this policy also covers for the damages that a spouse of the victim suffers for lacking the services that he or he would have enjoyed had not been the injury suffered by the victim at the workplace. Some stated that the insurance policy also covers for damages or harm that an employee suffers from a service or product that is produced by the employer. The respondents argued that in such a situation, the employer is held liable as a manufacturer and as an employer. The policy also covers for injuries that are suffered by family members as a result of the injury sustained by the victim (employee) and this in most cases is referred to as consequential bodily injury. 4.2.3 What the insurance does not cover The respondents argued that in an organisation, working conditions may be okay but an employee happens to suffer an injury when in the process of conducting assigned duties and responsibilities as a result of his negligence. In such a situation, the employer is not liable for the injury suffered by the employee. This therefore means that the insurance policy does not cover damages or injuries that arise as a result of employee’s negligence. 4.2.4 Benefits of the insurance policy to an organisation The respondents of this study stated that there are a number of benefits that an organisation that has the employer liability insurance enjoys. The respondents argued that it’s cheaper for the organisation when an employee is compensated by the insurance company that the organisation associates with rather than when the company is taking full responsibility of the injury suffered by the employee and his/her family members. Some argued that the employee that suffers injury does not claim compensation from the organisation but rather from the insurance company that the organisation has registered with. This enables the company’s operations not to be disrupted and they keep on flowing smoothly hence enabling the organisation to achieve its targets within the set time. 5.0 Conclusions and Recommendations 5.1 Conclusion The employer liability insurance is simply an insurance policy which protects organisations from liabilities that arise from the fatality, injury or diseases to their respective employees that arise from workplace practices or conditions. It covers for all injuries that are suffered by employees while on duty but do not cover damages that arise as a result of employee’s negligence when on duty. This policy benefits an organisation in various ways. It’s cheaper for an organisation when an employee is compensated by the insurance company that the organisation associates with rather than when the company is taking full responsibility of the injury suffered by the employee. 5.2 Recommendations As discussed above, we can see the benefits of the employer liability insurance to business organisations. Since it is the duty or responsibility of an organisation to compensate any of its employees that suffers harm or injuries when on duty as a result of employer negligence, it is therefore very important for organisations to have such insurance policies. It helps reduce the burden that the organisations suffer when compensated the injured employees. References Athman, B. 2008. “Analysing employer liability insurance.” New Republic 6: 17–19. Austin, P. 2002. “What are the benefits of employer liability insurance?” Human resource journal 34: 20-67. Barry, T. 2000. “Responsibilities of employers to employees”. Journal of research 59: 35–62. Bernice, S. 2004. “What are the benefits of employer liability insurance?” Human resource journal 32: 2–15. Betty, T. 2004. “Responsibilities of employers to employees”. Journal of business research 59: 25–60. David, S. and Diana S. 2007. Analysing importance of different types of insurance policies. London: Cassell. Faith, M. and David B. 2006. Analysing importance of employer liability insurance to an organisation. London: Cassell. Fukuyama, F. 2002. Research: research methodology and procedures. New York: Farrar. Gregory, M. 2004. “Analysing different research methodologies.” New Republic 7: 7- 12 Terry, M. 2000. “Research on the benefits of employer liability insurance?” Human resource journal 34: 20-67. Read More