Construction site damage - not just a National Insurance problem
Mar 4, 2020
Every month, every employee sets aside a significant amount from his salary for the National Insurance Institute (NII). The set aside amount is intended - among other things - to allow the National Insurance Institute to assist him in the event that he is injured in a work accident (or suffers from an occupational disease). But although the National Labor Relations Board is responsible for standing up for the rights of those injured at work, sometimes there are additional parties who can be found liable for damages in workplace accident cases. For example, it is known that an employer whose employee is injured on a construction site can be required by the employee to pay compensation in addition to the compensation paid by the National Labor Relations Board. Similarly, the employee can also sue additional parties such as third parties who caused the injury. More than once, the National Insurance Institute, as the one who bears the burden of paying the first tier of the employee's lost wages and disability or survivors ' benefits, files a compensation claim (also known as a "replacement claim") against third parties responsible for the injury to the employee . This is a claim in which the National Insurance Institute demands that the person it claims caused the accident compensate it for the amounts that were paid and/or will be paid by it in the future to the injured party or his survivors. The origin of the name "compensation claim" is derived from the verb "to return", or more correctly "to return". That is, to return money to the National Insurance Institute.
Those involved - who is insured under the National Security Agency - and who is not:
The injured party : An employee of a subcontractor - insured as an employee with National Insurance.
The employer : (the subcontractor) - insured as an employer with National Insurance.
Main contractor : constitutes a third party in terms of National Insurance.
Every month, every employee sets aside a significant amount from his salary for the National Insurance Institute (NII). The set aside amount is intended - among other things - to allow the National Insurance Institute to assist him in the event that he is injured in a work accident (or suffers from an occupational disease).
But although the National Labor Relations Board is responsible for standing up for the rights of those injured at work, sometimes there are additional parties who can be found liable for damages in workplace accident cases. For example, it is known that an employer whose employee is injured on a construction site can be required by the employee to pay compensation in addition to the compensation paid by the National Labor Relations Board. Similarly, the employee can also sue additional parties such as third parties who caused the injury.
More than once, the National Insurance Institute, as the one who bears the burden of paying the first tier of the employee's lost wages and disability or survivors ' benefits, files a compensation claim (also known as a "replacement claim") against third parties responsible for the injury to the employee . This is a claim in which the National Insurance Institute demands that the person it claims caused the accident compensate it for the amounts that were paid and/or will be paid by it in the future to the injured party or his survivors. The origin of the name "compensation claim" is derived from the verb "to return", or more correctly "to return". That is, to return money to the National Insurance Institute.
Those involved - who is insured under the National Security Agency - and who is not:
- The injured party : An employee of a subcontractor - insured as an employee with National Insurance.
- The employer : (the subcontractor) - insured as an employer with National Insurance.
- Main contractor : constitutes a third party in terms of National Insurance.
The legal source for a claim for compensation or indemnity
According to Section 328(a) of the National Insurance Law, the National Insurance Institute has a "right of recourse" against wrongdoers to the extent of their liability. This section states that if the case for which the National Insurance Institute was obligated to pay also establishes a cause of action against a third party (such as main contractors on a construction site in the event of a work accident in which a subcontractor's employee is injured), the way is opened for filing a "substitution claim."
In a compensation claim, the National Insurance Institute files a claim based on a calculation of the amount of money that has been paid and will be paid by it to the injured party (or his survivors and family members), and each of the responsible wrongdoers may be liable for compensation, according to the extent of his liability. The calculation of these amounts is supported by an actuarial report and a public servant certificate, and the calculation of the discounting of the benefits is done according to the discounting rate, as stipulated in the National Insurance (Discounting) Regulations, 1978.
The National Insurance Institute's reason for restitution is derived from the principles of substitution. The National Insurance Institute steps into the shoes of the injured party and enforces his rights against the tortfeasor. In work accidents on construction sites, it is the shoes of the injured worker, against the one who caused the injury through his negligence. To the extent that the injured party files a claim for negligence and his claim is proven, the National Insurance Institute will be entitled to have his subrogation claim accepted. However, even if the injured party did not file a civil claim , the National Insurance Institute can still file an independent claim , but this time it will be required to prove the elements of the tort of negligence (negligence, damage and a causal link between them).
According to Section 328(a) of the National Insurance Law, the National Insurance Institute has a "right of recourse" against wrongdoers to the extent of their liability. This section states that if the case for which the National Insurance Institute was obligated to pay also establishes a cause of action against a third party (such as main contractors on a construction site in the event of a work accident in which a subcontractor's employee is injured), the way is opened for filing a "substitution claim." In a compensation claim, the National Insurance Institute files a claim based on a calculation of the amount of money that has been paid and will be paid by it to the injured party (or his survivors and family members), and each of the responsible wrongdoers may be liable for compensation, according to the extent of his liability. The calculation of these amounts is supported by an actuarial report and a public servant certificate, and the calculation of the discounting of the benefits is done according to the discounting rate, as stipulated in the National Insurance (Discounting) Regulations, 1978.
The National Insurance Institute's reason for restitution is derived from the principles of substitution. The National Insurance Institute steps into the shoes of the injured party and enforces his rights against the tortfeasor. In work accidents on construction sites, it is the shoes of the injured worker, against the one who caused the injury through his negligence. To the extent that the injured party files a claim for negligence and his claim is proven, the National Insurance Institute will be entitled to have his subrogation claim accepted. However, even if the injured party did not file a civil claim , the National Insurance Institute can still file an independent claim , but this time it will be required to prove the elements of the tort of negligence (negligence, damage and a causal link between them).
To simplify matters, below is an example case that was recently heard before the Haifa District Court (Ta 3380-01-17). This is an unfortunate incident in which an employee of a skeleton contractor was injured at a construction site and suffered severe bodily harm, following a fall from a great height due to the collapse of scaffolding.
The worker, who was a healthy and strong man in his 50s on the day of the incident, was left with serious physical damage after the accident, including complete paralysis of his lower body, loss of control over his sphincters, seizures, and various medical problems.
The injured party filed a claim against both his direct employer (the skeleton contractor) and the main contractor. The National Insurance Institute, which recognized the accident as an occupational accident, claimed that it had paid and would pay the injured party approximately 3.8 million shekels. His claim was filed against the main contractor only.
Since the court determined that the main contractor's liability would be approximately 30% of the damage (the bulk of the negligence was placed on the shoulders of the skeleton contractor, the direct employer), the court ruled that the National Insurance Institute would be entitled to receive from the main contractor a refund of approximately 30% of the amounts paid and to be paid to the injured party by it.
Case study
Why is the employer exposed to these events?
Does a contractor's work policy also cover a subrogation claim?
The question arises, does a contractor's insurance policy provide coverage for a claim for compensation from the National Insurance Institute? Well, as you know, a contractor's insurance policy consists of three chapters:
- Employers' insurance.
- Property insurance.
- Third party insurance.
Because the National Insurance claim is a third-party claim, the insurance coverage in the policy is found in the chapter dealing with third-party insurance. However, this is a chapter full of exceptions, including (usually) the exception for substitution claims by the National Insurance Institute. In order for the policy to provide a response on the day of the order, it is important to verify in advance that the exception for substitution claims has been canceled.
Not only that, the cancellation of the exception alone is not enough. Compensation claims following a work accident can be filed for huge amounts. For example, in the case described above, the plaintiff's damages were assessed in court at approximately 7 million shekels, and the National Insurance Institute submitted a compensation calculation of almost 4 million shekels. It should be noted that from now on, in addition to the cancellation of the exception against compensation claims, it is necessary to ensure that the insurance coverage is in adequate amounts .
Often, contractors and entrepreneurs who purchase insurance for construction work without receiving proper advice purchase a policy that includes the cancellation of the aforementioned exception, but do not take the additional step of anchoring appropriate amounts (for example, in the amount of approximately 20 million shekels).
The question arises, does a contractor's insurance policy provide coverage for a claim for compensation from the National Insurance Institute? Well, as you know, a contractor's insurance policy consists of three chapters:
Employers' insurance.
Property insurance.
Third party insurance.
Because the National Insurance claim is a third-party claim, the insurance coverage in the policy is found in the chapter dealing with third-party insurance. However, this is a chapter full of exceptions, including (usually) the exception for substitution claims by the National Insurance Institute. In order for the policy to provide a response on the day of the order, it is important to verify in advance that the exception for substitution claims has been canceled. Not only that, the cancellation of the exception alone is not enough. Compensation claims following a work accident can be filed for huge amounts. For example, in the case described above, the plaintiff's damages were assessed in court at approximately 7 million shekels, and the National Insurance Institute submitted a compensation calculation of almost 4 million shekels. It should be noted that from now on, in addition to the cancellation of the exception against compensation claims, it is necessary to ensure that the insurance coverage is in adequate amounts .
Often, contractors and entrepreneurs who purchase insurance for construction work without receiving proper advice purchase a policy that includes the cancellation of the aforementioned exception, but do not take the additional step of anchoring appropriate amounts (for example, in the amount of approximately 20 million shekels).
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