Employers' activity deviating from compulsory insurance can be ceased in Azerbaijan

Business Materials 5 May 2010 17:34 (UTC +04:00)

Azerbaijan, Baku, May 5 / Trend U. Ismayilova /

Employers deviating from compulsory insurance against accidents of their employees will be fined 3,000-5,000 manat in Azerbaijan, deputy head of the Parliamentary Standing Committee on Social Policy Musa Guliyev said in an interview with participants of the property market. Currently, the bill "Compulsory insurance of disability resulting from occupational diseases and accidents at work" is in the third reading in the Parliament.

"The use of penal sanctions against violators of the law will increase the interest among employers towards compulsory insurance", Guliyev said.

He said that this type of insurance in Azerbaijan will be obligatory.

He also noted the importance of strengthening the social welfare of people injured at work.

"All these measures are included in the bill. Now employers and employees will be interested in reducing the number of accidents at work. The responsibility of construction companies will increase", Guliyev said.

MP said that the introduction of the mandatory type of insurance in Azerbaijan is important.

According to the Labour Inspectorate under the Azerbaijani Ministry of Labour and Social Protection, during 2009, employees of labor inspection revealed 9,124 violations of the rights of workers.

Under the draft law "Mandatory insurance of disability resulting from occupational diseases and industrial accidents", an insurer must have a license to render life insurance services and insurance services.

The law will be applied to prisoners involved in labor activity, students and pupils who are undergoing the practice, military personnel assigned to the enterprises, physical entities engaged in individual entrepreneurship and labor activity as well as military and those involved in the work in mode of emergency. The document will also apply to foreigners and people without citizenship of Azerbaijan.

Insurance cases will be determined according to the developed act on industrial accidents in accordance with the law or by a court decision.

An insure person has the right to choose an insurer. But it can not refuse from concluding the agreement on compulsory insurance, except in cases specified by law. The agreement on compulsory insurance against accidents is concluded for an indefinite period.

The maximal insurance rate is fixed at 2 percent of the fund's salary. According to various sectors tariffs will be differentiated. Presumably, all spheres of economic activity will be divided into three or four groups depending on the degree of risk. Under the project, the insurance rates for some sectors can be reviewed by relevant executive authority annually. At the same, tariffs for the next year must be approved before December 1, this year.

There are 27 insurance and one reinsurance company in Azerbaijan.