Do you employ people around your home for example, someone who comes to clean your house or tends to your garden regularly.
Did you know, you could be at risk of a compensation claim if they were injured while in your employ and on your property.
A little known fact is that it is compulsory to take out a Household Workers’ Insurance Policy if you employ a household worker in, or about, or in connection with your primary place of residence or connected property. Importantly, home and contents and public liability insurance does not cover homeowners and renters for casual workers employed to do work in or around a home. These products only cover visitors to a home.
Imagine if your cleaner, gardener or babysitter were to fall and break his or her arm while in your home. You could be sued for medical costs and wage compensation, which could amount to thousands of dollars.
Who is considered a ‘household worker’?
Household workers include cleaners, nannies, babysitters, gardeners, handymen and in-home carers. Even if a worker has an ABN and refer to themselves as a ‘contractor’, some sole traders might do work more like a worker.
In some states and territories, household worker insurance is offered as an optional extra to your home and contents policy. However, in Queensland, household or domestic worker insurance policies can only be obtained through WorkCover Queensland.
What does a household worker insurance policy cover?
This type of policy covers household workers for both statutory and common law claim costs due to injuries sustained in the course of their employment with you. The costs include medical expenses and weekly compensation for the injured worker when they are unable to work.
What if business activities are conducted in a private dwelling?
Operating a business from home does not exclude you from having a Household Workers’ insurance policy. Some people use a part of their house or its grounds to conduct their business activities, such as photography studios, architectural services, counselling/therapy services, and farming. These areas are not considered a private dwelling as they are not used in the sole capacity as a domestic residence.
If a worker is employed wholly or partly in connection with a business, they cannot be considered a household worker and the employer needs to insure them under an Accident Insurance policy.
However, if you separately have workers who are engaged solely in connection with, or in and about, the private dwelling only, and not the business, they may not be covered by a business insurance policy.
Property investors, owner/occupiers and tenants
Whether you are a homeowner or a tenant, you need to protect yourself against the costs of a claim if have people come into your home to assist you and they are injured while they are working in your home.
Landlords who engage workers for their rental property, are not covered under a Household Workers’ insurance policy and must take out an Accident Insurance policy.
An Accident Insurance Policy is also recommended for homeowners who let out part of their house short term to the public regardless of whether they are living at the property or not.
Household worker insurance in action
Costs associated with household worker injury claims can be significant, with one injury incurring as much as over $115,000 in rehabilitation and medical expense costs. Since January 2015, uninsured household worker claims lodged with WorkCover have cost over $35,000 on average, while claims against existing policyholders have cost $16,000 on average.
Between November 2015 and October 2017, Queenslanders who hired casual cleaners, babysitters, nannies, gardeners, labourers and in-home carers have claimed over $615,000 for household worker injury claim costs because they took out a $50 insurance policy.
As an example, a homeowner, on the Sunshine Coast, hired an experienced labourer to build a pergola on her property. The labourer fell four metres from a faulty scaffold and severely fractured his heel. The labourer had to crawl across the backyard to reach his phone to call an ambulance. The homeowner had a domestic workers insurance policy and was covered for the costs of the workers treatment and recovery.
In another example, a family from Coorparoo had their European holiday thrown into chaos when their house sitter called with the news she had seriously broken her foot. The house sitter advised that she had dislocated and broken three bones in her foot after falling down a step while taking out the rubbish at the family’s property.
The house sitter had surgery to insert screws in her foot and spent the next 3 ½ months off work. The family had domestic worker’s insurance, which covered the costs of the medical expenses and weekly wages during the worker’s recovery.
Costs of insurance
A small investment can alleviate a lot of stress if you have people working in or around your home. WorkCover Queensland’s Household Workers’ Insurance policy costs $50 for a two-year set term. The current period of insurance runs from 1 January 2019 to 31 December 2020.
If you are experiencing difficulties dealing with a claim with your insurer, the team at Active Law may be able to assist you. You can contact us at (07) 3160 0000 or email at email@example.com .