In what will be a dramatic change, an inter-ministerial committee headed by Ministry of Labor director general Israel Uzan and National Insurance Institute deputy director for disabilities and rehabilitation Yarona Shalom has recommended abolishing the recognition of accidents that occur on the way to work as work accidents. People injured in such accidents will no longer qualify for payouts from the state, but will instead be advised to file a claim against the private insurance companies.
The committee’s report finds that the state currently pays NIS 6.8 billion annually to people injured at work, 2.5 times the amount paid in 2017. The number of people receiving welfare allowances for work-related disabilities has risen from about 40,000 in 2012 to 68,000 in 2022, and the committee attributes this to, among other things, a rise in the number of road accidents on the way to and from work.
In 2020, more than a quarter of the work-related injuries in Israel, 26.5%, occurred in road accidents, which compares with 22.4% in 2011.
This, according to the committee, means that an increasing proportion of the state benefit "no longer serves the benefit’s basic purpose." The committee finds that these are accidents over which the employer has no control and which he cannot prevent. 70% of the accidents on the way to and from work are accidents involving road vehicles.
On the basis of these findings, the committee recommends cancelling the recognition of road accidents occurring on the way to and from work as work accidents entitling those injured in them to state benefits. The committee carried out a simulation that showed that the damages that an injured person will receive under the Road Accident Victims Compensation Law or under the law of torts (if the accident did not involve a road vehicle) will not lead to any economic disadvantage in comparison with the work accident benefit, since the road accident compensation is likely to be higher, and any work accident benefit will be deducted from it, so that the final sum is expected to be the same as it is today.
Nevertheless, the committee acknowledges that its recommendation is liable to make the compensation procedure more cumbersome. Injured persons no longer recognized as having work-related injuries will have to sue the private insurance companies responsible for compulsory vehicle insurance, a very slow procedure. A year can pass between the accident and the filing of a claim in court, and several years are liable to pass before a ruling is given. This compares with just a few months taken to receive an accident benefit from the National Insurance Institute.
A further disadvantage pointed out by the committee is that the eventual payout by the insurance company is usually in the form of a one-time payment, rather than a periodic payment that gives the injured person greater financial certainty over time.
Adv. Ronen Vardi, an expert on work accidents, agrees that the committee’s recommendation could solve some of the current duplication in compensation payments arising from the fact that the insurance companies indemnify the National Insurance Institute for payments to people injured in road accidents. He says, however, that the one-time compensation payment is a dramatic disadvantage that takes away from the continuity of the lifelong payments that injured people currently receive. In addition, a person not recognized as injured at work will not receive compensation for loss of earning capacity from the insurance companies.
Ronen estimates that many people injured in accidents that are not road accidents will also be disadvantaged. They will now have to prove negligence on the part of whoever injured them, to pay large fees to lawyers, and to conduct proceedings that can take years, some of which will end with a loss or a painful compromise. Ultimately, Ronen says, people will continue to pay the same premiums to the National Insurance Institute, which will not reduce the amounts it collects, but will receive fewer rights.
Published by Globes, Israel business news - en.globes.co.il - on January 8, 2025.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2025.