Mandurah (08) 9584 6000
Cunderdin (08) 9635 1539
Narrogin (08) 9853 9800
Geraldton (08) 9960 5600

10 Most Common FAQs on Workers Compensation Insurance

We’ve answered the 10 Most Common FAQs on Workers Compensation Insurance, as asked by our clients. Ensure your workers are covered in case of accident and injury and reduce your liabilities as an employer.


1. Why do I need workers compensation insurance?

Employers are required by law to hold a current policy of workers compensation insurance. This is to cover the amount payable to any of your workers who suffer a work-related injury or compensable industrial disease. It’s certainly not an area to neglect; an accident doesn’t even need to occur to be hit by steep financial penalties.

For starters, it’s important to be aware that failing to have workers compensation insurance can incur a penalty of $2,000 from WorkCover WA. You may face a penalty of up to $5,000 per worker employed during the uninsured period. Worse yet: this is in addition to paying the cost of the premium avoided.

Finally, if an injured worker brings a claim during the period when you were uninsured, you will be responsible for the entirety of costs associated with that claim.


2. I am a sole trader/partnership, can I take out workers compensation insurance for myself?

No, sole traders or partnerships cannot take out cover for themselves. If you are a Working Director of a Proprietary Limited (Pty Ltd) company, you can opt-in to cover yourself for workers compensation. A Working Director is a director who executes work in the form of personal manual labour or services for, or on behalf of, the company.


3. Can I take a workers compensation policy out in the name of a trust?

No, trusts are only an account name and WorkCover will not accept this as a legal entity. Therefore, the policy would require the details of the trustees as they are the responsible party for the trust. The trustee could only be a sole trader, partnership or Pty Ltd Company.


4. What about family members? Do they need cover?

A family member residing with the employer and employed within the business is defined as a ‘worker’ under the Workers Compensation and Injury Management Act. There is no need to disclose their names to have cover, however, their wages must be included under the General Employees section of the wages declaration.


5. What about working contractors and subcontractors?

Contractors and subcontractors who have been engaged by you for the purpose of your trade or business are considered to be your “workers” under the Workers Compensation and Injury Management Act. Contractors are considered workers provided they are under a contract for service (i.e. not direct employees) and receive remuneration by whatever means as a return for their personal manual labour or service.

If contractors and subcontractors have been or are likely to be engaged, they need to be declared on the Contractors and SubContractors section of the wages declaration form.

The Workers’ Compensation and Injury Management Act makes an employer jointly and severally liable for injury to the workers of any of your contractors or subcontractors. It’s important that you satisfy yourself that all contractors and subcontractors have insurance covering their own workers.


6. What is defined as wages/remuneration, and what should be included in actual and estimated wage declarations?

“Remuneration” is as defined by the Act and includes:

All wages, salaries, remuneration, commissions, bonuses, overtime, allowances and the like directors’ fees, superannuation contributions (except those made by force of law), fringe benefits, and all other benefits paid (whether paid in cash or non-cash benefits such as vehicles, equipment, mortgage payments, travel, school fees etc.) to or in relation to a Worker (including working directors declared as such to us) or to Contractors, before deduction of income tax.

“Remuneration” does not include termination payments, retirement pay, retrenchment pay in lieu of notice, pensions, “golden handshakes”, or weekly payments of workers’ compensation.


7. Do we need to include superannuation in our wage declaration amounts?

Not the minimum superannuation guarantee of 9.5%. However, as an employer, if you choose to pay higher than this amount the difference does need to be included in your wage declaration. This includes amounts paid under salary sacrifice arrangements.


8. What do I do if one of my workers has an injury?

If an injury occurs, you must ensure that the worker receives immediate first aid treatment if required and that the worker visits a qualified medical practitioner of their choice to obtain a First Medical Certificate of Capacity. The worker must be advised of the injury management process.

Please notify your broker at Country Wide Insurance Brokers who will advise and assist you with the claims lodgement process.


9. How do I lodge a workers compensation claim?

Make contact with your broker at Country Wide Insurance Brokers who will assist you with the entire process. Your broker will provide you with details of the information required to lodge a claim. We’re here to guide you through the process and clear up any confusion.

The information required will include your completion of an Employer Report of Injury Claim form with wage information for the insurer to confirm the worker’s rate of pay.

The injured worker will be required to complete an Employee Claim form and return this to you with the first medical certificate received from their medical practitioner.

Your broker will check to ensure all the required information has been provided before lodging the claim to the insurer. Please note that all claims should be lodged and must be done within 5 days. It is important to note that penalties apply from Workcover for late submissions.


10. When do I pay the injured worker and how much?

Your Country Wide broker will keep you informed of the status of the claim. When / if approved by the insurer, you will be notified of the rate of pay. You must then begin workers compensation payments without delay.

The first payment must be made within 14 days of claim acceptance once the insurer has informed you of the amounts.

Compensation must be paid in the usual manner on their usual payday and must continue until you are advised by the insurer that payments can be ceased.

As payments are made you can submit those wage costs to the insurer via a wage reimbursement form so that they can be reimbursed back to you.

If you require further information on Workers Compensation please contact us, call us on (08) 6279 2300 or email us at


This publication contains information regarding workers’ compensation and injury management. It is intended to provide general information only. This article should be read in conjunction with the Workers’ Compensation and Injury Management Act 1981. You should seek appropriate legal/professional advice about your particular circumstances. For more information, visit the WorkCover WA website at