Your insurer can only cancel your workers compensation policy if your business has ceased trading or been sold.
Your insurer can cancel your policy in the following situations:
Your policy can be cancelled if the business has ceased trading. You will need to provide evidence of having ceased trading to the licensed insurer agent that holds the policy.
Your policy can be cancelled if a liquidator/trustee in bankruptcy has been appointed and the business has ceased trading.
Your policy may be cancelled if the business is sold. The new owner may need to take out a new workers compensation insurance policy covering their employees. Give us a call or talk to your insurer for more information.
In all other situations you should discuss with your insurance agent the reason for wanting the policy cancelled.
Licensed insurers cannot cancel a policy if:
- you take out a new policy at a lower premium
- you no longer have employees. In this case the policy can be cancelled at expiry of the policy period
- a liquidator or administrator is appointed and the employer continues trading even if the liquidator or administrator attempts to take out a new policy
For more information, contact your insurer.
Failure to obtain or maintain a workers compensation policy can result in fines, penalties or recovery proceedings. The maximum fine that can be imposed by court is $55,000 or six months imprisonment, or both.