Workers' Accident Compensation Insurance Japan, Complete Guide

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In Japan, workers' accident compensation insurance is a mandatory coverage for employees. It's designed to provide financial support in case of work-related injuries or illnesses.

The insurance covers medical expenses, lost wages, and rehabilitation costs. This means that employees can receive compensation for the time they're unable to work due to their injury or illness.

The Japanese government requires employers to enroll their employees in this insurance program. This ensures that workers have access to necessary medical care and financial support.

The insurance coverage typically includes medical expenses, such as hospital bills and medication costs.

What is Workers' Accident Insurance?

Workers' accident insurance in Japan is a government-run program that covers expenses and compensations for work-related accidents, disability, or death. Any business that hires even one employee must enroll in this insurance.

Employers pay 100% of the insurance premium at the start of the fiscal year. This is a mandatory requirement, and employers are obligated to report any work-related accidents to the Labor Standards Inspection Office.

Credit: youtube.com, Worker's Compensation in Japan - What to do when you get injured on the job

Workers' accident insurance covers a range of benefits, including medical expenses, leave allowance, disability compensation, compensation for the bereaved family, and support for the insured person's return to society.

Here are some scenarios where workers' accident insurance applies:

  • Employees get injured because of accidents occurred while they are working.
  • Employees are involved in accidents while commuting to and from work (Commuting Accident).
  • Brain or heard diseases of employees are caused by overload in the workplace.
  • Mental disorders of employees are caused by harassments in workplace.

These benefits are designed to support employees who are injured or become ill due to work-related reasons or commuting. By understanding what workers' accident insurance covers, employees can feel more secure in their jobs.

Benefits and Coverage

In Japan, workers' accident compensation insurance provides financial assistance to employees who get injured on the job or while commuting.

The insurance covers any illness, injury, disability, or death resulting from an accident caused by work or commuting.

This means that if you're involved in an accident while on your way to or from work, your employer's insurance will help cover the costs, giving you peace of mind and financial security.

Benefits and Coverage

Benefits are paid for any illness, injury, disability or death incurred as a result of an accident caused by work or while commuting.

Credit: youtube.com, Summary of Benefits and Coverage

You can receive medical treatment at designated hospitals without paying any costs yourself, as the insurance will cover all expenses. If you visit a non-designated hospital, you'll be charged as usual but can receive a refund later.

If a worker has not recovered within 18 months, they may be eligible to receive the Illness or Injury Compensation Pension.

There are 32 designated medical facilities nationwide where employees don't need to pay medical expenses for treatment related to work or commuting.

The Labor Standards Inspection Office handles claims for medical compensation benefits, and you'll need to submit a designated claim form to them.

From the fourth day of missed work onward, the insurance covers two-thirds of a worker's lost earnings.

Disability remains after treatment, workers may be eligible to receive the Disability Pension Benefit, which has 14 levels covering around 140 types of disability.

Consider reading: Pension Term Assurance

Bereaved Family Benefit

If you've lost a loved one due to a work-related accident, there is help available. The Bereaved Family Compensation Benefit is a form of support provided to family members who relied on the deceased worker for financial assistance. This benefit acknowledges the financial burden that comes with losing a primary breadwinner.

Here's an interesting read: Family Life Insurance Policy

Enrollment and Eligibility

Credit: youtube.com, First introduction to worker’s compensation

If your business hires even one employee, you must enroll in workers' accident compensation insurance, regardless of their employment status.

However, some businesses and employees are not covered by workers' accident compensation insurance. Government office workers, government-owned businesses, and those insured by seamen's insurance (other than those insured by voluntary disease continuation) are not covered.

Contractors or board members with representative or administrative rights are also not covered, although board members who work under a representative and receive wages can be covered.

Most freelancers are excluded from insurance coverage, but a special voluntary enrollment system exists for them.

Here are some examples of sole proprietors/freelancers who can enroll in this voluntary insurance: taxi drivers, carpenters/construction workers, foresters, and fishers.

To enroll in the special enrollment system, you must do so through a proxy, such as the industries' respective unions or relevant agencies.

Cost and Enrollment

The cost of workers' accident compensation insurance in Japan can be a significant expense for employers. Premiums are calculated based on the company's payroll, with rates varying depending on the industry and location.

Professionals discussing home insurance policy over laptop and notes in an office setting.
Credit: pexels.com, Professionals discussing home insurance policy over laptop and notes in an office setting.

Employers in high-risk industries, such as construction or manufacturing, typically pay higher premiums. For example, the premium rate for the construction industry is around 2.5%, while the rate for the manufacturing industry is around 1.5%.

The enrollment process for workers' accident compensation insurance is relatively straightforward. Employers are required to enroll their employees in the system, which typically involves providing personal and employment information.

How Much Does Workers' Comp Insurance Cost?

Calculating workers' compensation insurance premiums is a straightforward process. You can use the formula: (total annual wage of all employees) x (insurance premium rate) = workers' accident insurance premiums.

The total employee wages are calculated by adding up the monthly wages and bonuses paid each month. You can find a list of insurance premium rates by industries on the MHLW site, but be aware that the rates haven't changed since 2018.

Insurance rates differ by industry because certain businesses are more prone to work-related accidents than others. If you're a continuing business, you'll pay the year's estimate of the workers' accident insurance premiums beforehand, with the difference settled at the end of the fiscal year.

Credit: youtube.com, Workers Compensation Insurance - How Much Does It Cost? 2022

You'll need to file a report within 50 days of any employee hires or retirements during the fiscal year, and if applicable, the difference will be refunded to you. Premium rates are reevaluated every 3 years for establishments with 100 or more employees, according to the number of reported work-related accidents.

The labor bureau will notify you when a change has been made to the premium rates, so you don't need to make an application. You can find forms for filing and paying insurance premiums on the Labor Insurance Information Center site.

Enroll in Workers' Accident Insurance

If your business hires even one employee, you must enroll in workers' accident compensation insurance. This applies to full-time, part-time, and day laborers, as well as employees with variable employment status.

Some businesses and employees are not covered by workers' accident compensation insurance, including government office workers, government-owned businesses, and those insured by seamen's insurance.

Credit: youtube.com, Group Personal Accident combined with Workers' Compensation (GPA/WC) & Group Life Insurance (GLA)

Contractors or board members with representative or administrative rights are also not covered, although board members who work under a representative and receive wages can be covered.

Most freelancers are excluded from insurance coverage, but a special voluntary enrollment system exists for them. This system is available for sole proprietors/freelancers like taxi drivers, carpenters/construction workers, foresters, and fishers.

To enroll in workers' accident insurance, you'll need to submit the following documents to the local Labor Standards Inspection Office:

  • Notice of Establishment of Labor Insurance Affiliation
  • Declaration of Estimated Labor Insurance Premiums
  • Certificate of All Historical Matters

The submission deadline is within 10 days from the establishment date of the insurance relationship, except for the Declaration of Estimated Labor Insurance Premiums, which must be submitted within 50 days. However, it's generally recommended to submit all documents and pay insurance premiums within 10 days.

See what others are reading: What Does 10 Year Term Life Insurance Mean

Special Cases and Procedures

In cases of work-related accidents, compensation insurance provides coverage for medical expenses and lost wages. This is a crucial aspect of workers' accident compensation insurance in Japan.

Person Holding Home Insurance Form
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If an employee suffers a work-related injury, they are entitled to receive medical treatment and compensation for their lost wages. This includes coverage for hospitalization, surgeries, and rehabilitation costs.

For accidents that occur during commuting to or from work, the insurance also provides coverage, as long as the accident is work-related. This means that even if the accident happens outside of the workplace, the employee may still be eligible for compensation.

Situation for Employee Rosai Receipt

If you're an employee in Japan, you might be eligible to receive Rosai, a type of compensation for work-related injuries. This can include commuting accidents, which are a common occurrence in Japan's busy cities.

To be considered a commuting accident, you must be traveling to or from work on a regular route. However, if you deviate from this route for daily necessities, such as buying food, and get back on track soon after, the injury may still be considered a commuting accident.

A unique perspective: Japan Travel Health Insurance

A close-up portrait of a smiling male construction worker wearing safety gear, including a hard hat and goggles.
Credit: pexels.com, A close-up portrait of a smiling male construction worker wearing safety gear, including a hard hat and goggles.

In Japan, there are various types of Rosai, including those related to electronic book preservation and having a side job. If you're an engineer or specialist in humanities or international service, you may be eligible for a specific type of visa.

Here are some popular topics related to Rosai receipt in Japan:

  • Invoice System in Japan
  • Electronic Book Preservation Act in Japan
  • Having a Side Job in Japan
  • How to apply for 労災 (Rosai) in Japan
  • Engineers/Specialist in Humanities/International Service Visa

When Changing Medical Institutions Due to Transfer, Surgery, etc

If you're changing medical institutions due to transfer, surgery, or other reasons, you'll need to notify the relevant authorities.

You'll need to fill out a specific form, either Form No. 16-4 for commuting disasters or Form No. 6 for work-related disasters.

All treatment costs must be paid in full at the counter until the necessary documents are submitted to the clinic.

Once you've submitted the documents and they're registered, the refund of your co-payment will be processed.

Frequently Asked Questions

What is rosai hoken in Japan?

Rosai Hoken is Japan's national insurance program that covers work-related injuries, illnesses, and fatalities. It's mandatory for all companies, including universities, to enroll in this program.

Maggie Morar

Senior Assigning Editor

Maggie Morar is a seasoned Assigning Editor with a keen eye for detail and a passion for storytelling. With a background in business and finance, she has developed a unique expertise in covering investor relations news and updates for prominent companies. Her extensive experience has taken her through a wide range of industries, from telecommunications to media and retail.

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