A Guide to Work Injury Compensation Insurance

The following is an excerpt of the “Work Injury Compensation: A Guide for Employers” taken from the Ministry of Manpower (MOM) website. For the complete MOM guide, please refer to the following link:


What is the Work Injury Compensation Act (WICA)?
The Work Injury Compensation Act (WICA) provides injured employees with a low-cost and expeditious alternative to common law to settle compensation claims.

To claim under WICA, the employee only needs to prove that he was injured in a work accident or suffered a disease due to his work. His employer (or employer’s insurer) is liable to pay compensation regardless of cause and continues to be liable even after the employment has ceased work or after a Work Pass has been cancelled. The amount of compensation is computed based on a fixed formula and is subject to caps. Dependants of deceased employees are also eligible to claim Work Injury Compensation.

Alternatively, the employee can file a civil suit against the negligent party under common law for damages. However, to succeed, he and his lawyer will need to prove that the employer or a third party had caused his injury. He will also need to substantiate the amount of damages before the Courts, and damages are not capped.

An injured employee can claim from either WICA or common law, but not from both.

Who is and who is NOT covered under WICA
WICA covers all employees engaged under a “contract of service” or “contract of apprenticeship” with an employer, regardless of salary level.

WICA does NOT cover self-employed persons, like independent contractors, domestic workers and any member of the Singapore Armed Forces, Singapore Police Force, Singapore Civil Defence Force Central Narcotics Bureau or Singapore Prisons Service.

Is it mandatory to purchase Work Injury Compensation insurance?
Every employer is required by law to maintain adequate Work Injury Compensation (WIC) insurance for:

  • All employees doing manual work, regardless of salary level, and
  • All employees doing non-manual work and earning $1,600 or less a month

This is applicable to both local and foreign employees.

Failure to do so is an offence punishable by a maximum fine of $10,000 and/or imprisonment of up to 12 months. If you did not maintain adequate insurance (e.g. you have 10 manual workers but bought insurance for only 8 of them), you would have committed an offence.

For other employees doing non-manual work with monthly earning of above $1,600, employers have the flexibility to decide whether to buy insurance for them. In the event of a valid claim, the employer will be required to pay the compensation if he does not have insurance coverage for this group of employees.

When is compensation payable?
Compensation is payable when an employee

  • suffers an injury by an accident arising out of and in the course of employment, or
  • contracts an occupational disease, or
  • contracted a disease due to work-related exposure to biological or chemical agents

“Arising out of the course of employment” is defined as an accident that happened during working hours or during overtime or while on official duties in the course of employment and it happened due to work related activities.

However, it also includes incidents that are incidental to employment such as while going to the washroom as well as slipping and falling within a company’s premises. An accident that happened in the course of employment is regarded as having arising out of the employment unless there is evidence to prove otherwise.

Benefits under the WICA
There are three compensation benefits that can be claimed:

  • Medical leave wages
  • Medical expenses
  • Lump sum compensation for permanent incapacity or death

Medical Leave Wages
An employee is entitled under WICA for Medical Leave Wages as per the table below:

Full Pay Up to 14 days Up to 60 days
2/3 Pay 15th day onwards up to 1 year 61st day onwards up to 1 year

Medical Leave Wages are:

  • computed based on worker’s Average Monthly Earnings (AME) i.e. average earnings over last 12 months before the accident, including overtime pay, but excluding transport allowance and reimbursement
  • payable only for working days that are covered by doctor-granted MC/hospitalisation leave
  • not payable on non-working days e.g. rest day and public holiday
  • to be paid no later than the worker’s usual pay day

Medical Expenses
Employees are entitled to claim for medical expenses :

  • up to the following maximum benefits as long as treatment is considered necessary by a Singapore registered doctor
  • that include the cost of medical consultation fees, ward charges, treatment, charges for physiotherapy, occupational and speech therapy, cost of medicine, artificial limbs, implants, etc.
Up to $25,000 or 1 year from date of accident, whichever is reached first Up to $30,000 or 1 year from date of accident, whichever is reached first

Lump sum Compensation for Permanent Incapacity or death
The third and final benefit that can be claimed under WICA is a lump sum compensation for permanent incapacity or death.

The levels of compensation following 1st June 2012 amendments are:

When is it payable? When an injury or illness permanently affects the employee’s ability to work When injury causes death of an employee
Formula for computing compensation Employee’s AME* x Age Multiplying Factor x % permanent incapacity (PI) Employee’s AME x Age Multiplying Factor
Compensation payable to Injured Employee Dependants of the deceased Employee
Minimum Compensation $73,000 x PI $57,000
Maximum $218,000 x PI $170,000

* AME = Average Monthly Earnings

Important Notes to arranging Work Injury Compensation insurance
When purchasing or reviewing insurance coverage, employers should:

  • Ensure that there is a Work Injury Compensation insurance covering their employees. Such an insurance policy should cover the benefits stipulated under WICA for employees injured at work, including medical leave wages, medical expenses (both hospitalization and outpatient) and permanent incapacity & death compensation
  • Check the types of employees covered under the policy Employers should review the occupations and number of employees listed on the insurance policy. It must reflect the employees who should be covered. Do not under declare the number of employees to be insured to the insurer. This will cause some of your employees to be uninsured
  • Check for any work-related exclusion clauses and recovery clauses With effect from 1 June 2012, work-related exclusion clauses will be disallowed. If an insurance policy bought after this date and contains work-related exclusion clauses, the insurer will still be liable to pay the compensation in the event of a valid claim. The insurer may be able to recover from the employer any such compensation paid out if the insurance policy contains a contractual clause allowing the recovery. When in doubt, employers should approach their insurers to clarify on of the terms in the policy.

Work-related exclusion clauses, except pertaining to asbestos, are prohibited for the purpose of WIC insurance. Insurers will be liable to make payment of the compensation even if work-related exclusions exist in the policy. Insurers are able to seek recovery contractually from the employer if such recovery is included in the insurance policy under the Avoidance of Doubt . This is applicable to both local and foreign employees.

For further information please visit the MOM website at:


Or if you have any specific enquiry requiring clarification, please contact the following:

60 Paya Lebar Road $05-13
Paya Lebar Square

Tel:  (65) 6225 5759
Fax: (65) 6223 3340

Email: enquiries@phoenixriskssvcs.com

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