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What’s the difference between WorkCover and personal accident insurance in Australia?

When you’re off the tools, cash flow can stop fast. Workers’ compensation (WorkCover) is a compulsory, state-based scheme for work-related injury or illness. Personal accident (PA) insurance is a private policy that helps protect your income 24/7 for accidental injury (with optional sickness cover only when selected with injury cover). PA is not a substitute for WorkCover; it helps where WorkCover doesn’t apply (for example, off-duty injuries or when you don’t meet the legal definition of a worker). Weekly PA benefits are paid subject to the excess period, offsets/repayments, exclusions and eligibility in the PDS.

What you should know about WorkCover and personal accident insurance

  • WorkCover (workers’ compensation) is mandatory for employers and applies to work-related injury or illness under state/territory law (definitions, benefits and processes vary by jurisdiction).
  • Personal accident insurance follows you 24/7 for accidental injury (and sickness if selected with injury cover). You cannot take sickness-only cover.
  • Weekly PA benefits are paid either on an agreed value basis (the Weekly Benefit amount shown on your certificate) or the lesser of 85% of pre-disability earnings (or higher if shown) and the weekly benefit amount. Payments are made fortnightly in arrears and no benefits are payable during the Excess Period.
  • Partial disablement under PA applies to injury only, and only after a period of total disablement has been paid; no partial disablement is payable for sickness.
  • Offsets and repayments apply: periodical payments (for example, statutory schemes), wages/income are deducted from PA weekly benefits; lump-sum payments for the same condition can suspend weekly benefits and may need to be repaid up to the lump-sum amount.
  • Contractors and sole traders often sit outside WorkCover definitions; PA can help protect income if an injury stops you working off-duty or when not deemed a “worker.”

The rules for workers’ compensation and personal accident insurance may change

Workers’ compensation is set by state/territory legislation and is updated over time. PA policy terms can also change on renewal. Always check the current regulator guidance for your location and the latest PDS for precise definitions, benefits, exclusions and claims requirements.

Does workers’ compensation cover commuting to work?

Travel to and from work is generally not covered under workers’ compensation. Some limited situations can vary by jurisdiction; use your local regulator guidance and claim instructions in the references to confirm your position. PA may respond to an accidental injury while commuting if the policy’s definitions and exclusions are met, subject to Excess Period and offsets.

Workers’ compensation by state snapshot (see References for regulators and claim pages)

State/Territory

Who needs it

Regulator/claim portal

Notable nuance

NSW

Employers with eligible workers 

icare NSW [2]

State scheme manager oversees employer policies and claims performance. 

VIC

Employers with eligible workers 

WorkSafe Victoria [3]

Insurance, claims, rehab and RTW governed by WorkSafe framework. 

ACT

Employers with eligible workers 

WorkSafe ACT [4]

Claim steps/timeframes set by regulator; check journey allowances. 

TAS

Employers with eligible workers 

WorkSafe Tasmania [5]

Forms and guidance by role (workers, employers, self-insurers, providers). 

NT

Employers with eligible workers 

NT WorkSafe [6]

No-fault scheme; entitlements include medical, weekly income and RTW support. 

WA

Employers with eligible workers 

WorkCover WA [7]

Employer obligations include current policy and injury management system. 

What a WorkCover or personal accident insurance event could cost your business

  • Operations: lost shifts, overtime or labour-hire to cover, schedule slippage.
  • People: manager time on incident reporting, certificates, and return-to-work coordination.
  • Finance: cash-flow pressure while you await claim decisions, premium/compliance exposure if WorkCover is not correctly arranged.
  • Projects/clients: missed milestones, rework, and potential contract impacts.

WorkCover and personal accident insurance preparedness for your organisation

  • Keep WorkCover current: ensure everyone who meets your jurisdiction’s worker definition is covered.
  • Map who isn’t a worker: contractors/sole traders may need PA for income protection outside the scheme.
  • Injury-management basics: document incident reporting, points of contact, and return-to-work steps.
  • Close the gaps with PA: consider agreed value where appropriate; understand the excess period, offsets, and exclusions.

How WorkCover and personal accident insurance benefits compare

Topic

Workers’ compensation (WorkCover)

Personal accident (PA) insurance

Who arranges it

Employer (compulsory for eligible workers)

Individual/business (voluntary)

Trigger

Work-related injury/illness (per local law)

Accidental injury 24/7; optional sickness only with injury cover

Weekly benefits

Statutory wage replacement rules

Agreed value (amount shown) or ≤ 85% of pre-disability earnings and the weekly benefit amount; Excess Period applies; paid fortnightly in arrears

Other benefits

Medical, treatment, rehab, prescribed impairment/death benefits

Capital benefits (injury only); business expenses (optional); rehab reimbursement; specified fracture/dental advance payments; limited Overseas meedical expenses

Commuting 

Generally not covered(travel to work)

May be covered if the event meets policy definitions and exclusions

Who sets rules

State/territory legislation and regulator

Policy wording and PDS

What WorkCover and personal accident insurance cover can include

  • WorkCover (workers’ compensation): reasonable medical/treatment costs, rehabilitation/return-to-work support, weekly wage replacement, and prescribed impairment/death benefits under the relevant legislation.
  • Personal accident insurance (per PDS): weekly benefits (per calculation rules above), capital benefits for injury only, optional Business Expenses cover while totally disabled, rehabilitation costs reimbursement (up to stated limits), advance payments for specified fractures/dental injuries (counted toward the Maximum Benefit Period), limited overseas medical expenses, and family accommodation allowance when hospitalised far from home. Always refer to the PDS for limits, exclusions, eligibility and claim evidence requirements.

Need help with personal accident insurance?

If you have questions about how this applies to your business, speak with your Marsh advisor. We can help align coverage, processes, and budget with your risk appetite and workforce structure.

Get a quote now

Frequently asked questions

WorkCover is the compulsory workers’ compensation scheme that every employer must hold for their employees, providing wage replacement, medical and rehab support for work-related injuries/illnesses. Names and rules vary by state/territory.

An optional policy you buy privately. It pays weekly benefits for accidental injury (and sickness if selected together with injury cover). Benefits are Agreed Value (amount shown) or the lesser of 85% of pre-disability earnings and the Weekly Benefit amount on the certificate, after the Excess Period; paid fortnightly in arrears.

WorkCover is compulsory and only for work-related incidents; PA is optional, designed to protect your income 24/7 (subject to exclusions), and includes offsets/repayments where other benefits are payable.

Generally, no. Consider PA for income protection if injury stops you working.

Yes, for eligible workers (penalties apply for non-compliance).

Often not (varies by state). PA may respond if policy terms are met; offsets may apply.

Not work-related, so WorkCover won’t apply. PA may respond subject to exclusions (e.g., professional sport is excluded).

WorkCover pays statutory medical, rehab and wage benefits. PA pays per the PDS (Agreed Value or ≤ 85% rule, Excess Period, fortnightly payments), plus eligible Capital Benefits (injury only) and Business Expenses (if selected).

Yes, if selected with injury cover; you cannot choose sickness-only, and no partial disablement is payable for sickness.

Yes. Off-duty risks can be addressed by PA; however, offsets/repayment rules apply where WorkCover or other payments are made.

Notify promptly; complete claim forms; provide medical certifications and financial evidence as requested; benefits are subject to Excess Period, offsets, exclusions, and eligibility.

References

1. Personal Accident and Injury Insurance PDS (au.marsh.com) 
2. NSW workers compensation | Insurance and Care NSW (icare.nsw.gov.au) 
3. WorkCover insurance | WorkSafe Victoria (worksafe.vic.gov.au) 
4. How to make a workers’ compensation claim | WorkSafe ACT (worksafe.act.gov.au) 
5. Workers compensation | WorkSafe Tasmania (worksafe.tas.gov.au) 
6. Workers’ compensation | NT WorkSafe (worksafe.nt.gov.au) 
7. Understanding your rights and obligations | WorkCover WA (workcover.wa.gov.au)

Marsh Advantage Insurance Pty Ltd (ABN 31 081 358 303, AFSL 238369) (“Marsh”) arranges the general insurance (i.e. not the Discretionary Trust Arrangement) and is not the insurer. This page contains general information and does not take into account your individual objectives, financial situation or needs. For full details of the terms, conditions and limitations of the covers, refer to the specific policy wordings and/or Product Disclosure Statements available from Marsh on request. Marsh makes no representation or warranty concerning the application of policy wordings or the financial condition or solvency of insurers or re-insurers. Marsh makes no assurances regarding the availability, cost, or terms of insurance coverage. Any statements concerning actuarial, tax, accounting, or legal matters are based solely on our experience as insurance brokers and risk consultants and are not to be relied upon as actuarial, accounting, tax, or legal advice, for which you should consult your own professional advisors. The Discretionary Trust Arrangement is issued by the Trustee, JLT Group Services Pty Ltd (ABN 26 004 485 214, AFSL 417964) (“JGS”). Any advice or dealing in relation to the Discretionary Trust Arrangement is provided by JLT Risk Solutions Pty Ltd (ABN 69 009 098 864, AFSL 226 827) (“JLT”). JGS and JLT are businesses of Marsh McLennan. The cover provided by the Discretionary Trust Arrangement is subject to the Trustee’s discretion and/or the relevant policy terms, conditions and exclusions.

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