In the first half of this year, the number of companies that have concluded health insurance contracts to cover the medical expenses of their employees has increased by 11 percent. Currently, 1,400 employers have insured 60,000 employees, which is a record high since the introduction of this insurance service in 2018. At the same time, employers have concluded three thousand liability insurance contracts, and this figure has remained unchanged over the past seven years, according to statistics from the Estonian Insurance Association (EKsL). :format(webp)/nginx/o/2024/07/20/16234771t1h358a.jpg)
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In the first half of this year, the number of companies that have concluded health insurance contracts to cover the medical expenses of their employees has increased by 11 percent. Currently, 1,400 employers have insured 60,000 employees, which is a record high since the introduction of this insurance service in 2018. At the same time, employers have concluded three thousand liability insurance contracts, and this figure has remained unchanged over the past seven years, according to statistics from the Estonian Insurance Association (EKsL).
According to EKsL board member Andres Piirsalu, employers are increasingly insuring employees’ medical expenses, but not their liability as an employer. “However, one insurance does not replace the other. While employer health insurance allows an employee to quickly and without waiting for a health problem, employer liability insurance compensates for damage caused to an employee as a result of an accident at work or a diagnosed occupational disease, relieving the employer responsible for the difficulties that have arisen of such expenses,” Piirsalu explained.
According to Piirsalu, the problem is most likely not money, but the fact that employers are not sufficiently informed about the benefits of liability insurance. "While the average annual health insurance premium for one employer is 11,000 euros (268 euros per employee), an Estonian employer currently pays about 400 euros per year for their company's liability insurance. The approximate number of insurance cases under employer's health insurance in our country is one hundred thousand per year. This is due to the fact that employees often visit medical specialists and dentists, as well as use other treatment options. At the same time, there are only about 70 cases of employer's liability insurance per year, when the employer is responsible for an accident at work or an occupational disease that occurs to an employee," said Piirsalu.
According to the Labour Inspectorate, 3,314 accidents at work and 13 cases of occupational diseases were registered last year.
Based on statistics, Piirsalu noted that many accidents occur at work, but only a few employers have insurance that covers their expenses in the event of an accident or occupational disease of an employee.
"Employers should consider taking out their own liability insurance, as the potential costs without such insurance may be unexpectedly high and burdensome for the company, especially since expensive litigation is sometimes added to it. The possibility of introducing compulsory insurance against accidents at work and occupational diseases in Estonia, as in other Nordic countries, has been discussed for about 30 years, but it is now unlikely. Seven insurance companies in Estonia offer voluntary employers' liability insurance, which essentially covers the same risks," Piirsalu noted.
In the first half of this year, insurance companies paid out a total of seven million euros in claims for damages under employers' health insurance and 53,000 euros under employers' liability insurance.
According to Aune Pärn, ERGO's Liability Insurance Portfolio Manager, employers' liability insurance is necessary for all companies – both low-risk office firms and companies in above-average risk industries such as construction, material handling and agriculture. "Currently, our largest compensation in a single employers' liability insurance case is approximately 122,800 euros, and this figure will increase over time, as such amounts are usually paid in installments over several months," said Pärn.
"If, for example, an employee falls down the stairs and breaks his leg while performing his work duties, this is an accident at work. Since it is usually the employer who is responsible for an accident at work, the employer's liability insurance contract covers the initial and subsequent costs associated with the accident that are not covered by the Health Insurance Fund. These include the costs of rehabilitation, assistive equipment, and so on. However, if an employee is confined to a wheelchair as a result of an accident at work and his income has decreased because he can no longer find a job with an equivalent income, the employer's liability insurance also compensates for the employee's decrease in income and additional costs of everyday life and rehabilitation related to the disability for the rest of his life, if the insured amount is sufficient," concluded Pärn.
Employer's health insurance and employer's liability insurance are offered by the following insurance companies in Estonia: BTA, ERGO, If Kindlustus, PZU and Seesam. Gjensidige and Salva offer only employer's liability insurance. Compensa Elukindlustus and LHV Kindlustus offer only employer's health insurance.
EKsL is a professional association that unites all insurers operating in Estonia and deals with the development of insurance and loss prevention, as well as the analysis and publication of insurance statistics. EKsL organises the resolution of insurance disputes through an insurance conciliation body.
