After a workplace accident, a managing director braces for two bills: the employee's claim for damages and a possible fine from the occupational safety authority. The third letter arrives months later and takes many by surprise: the health insurance fund demands that the company pay the cost of accident sick pay, hospital treatment and possibly an annuity. This is neither a mistake nor a penalty, but the reimbursement rule of the Act on the Benefits of Compulsory Health Insurance, which is linked to breaches of occupational safety rules. As a broker, I see that most SMEs do not know about this item, nor whether their employer's liability insurance covers it. This article sets out the rule, the procedure and where insurance cover ends.
- Under Section 67(1) of the Compulsory Health Insurance Benefits Act (Ebtv.), the employer must reimburse the health insurance benefits provided because of an accident at work or an occupational disease if the accident resulted from the employer or its agent breaching the occupational safety rules binding on them – this is a separate item, independent of the employee's own damages claim.
- The claim may include accident sick pay, accident-related healthcare services and the accident annuity; the health insurance fund enforces it by a payment order, and in one published Kúria (Hungary's supreme court) case it amounted to nearly HUF 3.8 million.
- Employer's liability insurance covers it only if the policy conditions expressly extend to reimbursement claims by the social security body – in Hungarian policy conditions this may be part of the basic cover, a separate clause or an exclusion, so the wording of your policy decides.
What is a reimbursement claim?
Under Section 67(1) of Act LXXXIII of 1997 on the Benefits of Compulsory Health Insurance (Ebtv.), the employer must reimburse the health insurance benefits incurred because of an accident at work or an occupational disease if the accident or disease resulted from the employer or its agent failing to meet its obligations under the occupational safety rules binding on it, or if it caused the accident intentionally. Section 68 is more general: anyone responsible for the illness, incapacity for work or damage to the health of a person entitled to health insurance benefits must reimburse the benefits provided as a result, to the extent of their responsibility – this rule can also reach companies when a third party suffers harm. The benefits to be reimbursed range from accident-related healthcare services through accident sick pay to the accident annuity; the amount therefore depends not on the employee's salary but on the actual cost of the benefits, and with a long hospital stay or a long-term annuity it runs into millions of forints. The health insurance authority enforces the claim by a payment order, which can be challenged in court; according to the legal literature, the authority has five years to do so. In a case described in a published summary by the Kúria (Hungary's supreme court), a payment order was issued requiring the employer to pay HUF 3,817,585 plus interest – it was ultimately set aside because the injury was not an accident at work: the employee had been repairing his own car after working hours. The lesson is twofold: the amounts are real, and the defence is a matter of law, not of discretionary leniency.
How does it differ from the employee's damages claim?
These are two separate legal grounds, against two separate parties. Towards the employee, the company is liable under Section 166 of the Labour Code (Mt.) for damage caused in connection with the employment relationship – this does not require a breach of occupational safety rules, and the company can be relieved of liability only in a narrow range of cases. Towards the health insurance fund, it is liable under Section 67 of the Ebtv., and the conditions for this are a breach of an occupational safety rule and a causal link: a missing risk assessment, training that was not given, protective equipment that was not provided, a faulty machine, a work procedure that was not followed. The two claims do not double up but complement each other: under Section 172 of the Labour Code, the benefits provided by social security must be deducted from the employee's compensation, so the state social-security system (TB) “advances” the money and then reclaims it from the employer who broke the rules. In both cases, the basis is the workplace accident report and the investigation by the occupational safety authority – whatever is recorded in these later reappears both in the payment order and in the liability insurance claim. Alongside the three routes of employee claims, this is the fourth and least known.
Does employer's liability insurance cover it?
Not automatically. Under Hungarian policy conditions, the basic cover of employer's liability insurance is the personal injury suffered by an employee and the non-pecuniary damages (sérelemdíj) for which the company is liable under the Labour Code. The social security body's reimbursement claim is a separate question: some policy conditions expressly include it in the cover, others take it on by a clause with a separate limit, and others again list it among the exclusions. A Hungarian broker's product description also warns that you need to check exactly which reimbursement obligations the quote extends to. Two further points depend on the policy conditions. One is whether the recourse claim and the employee's loss are charged to the same limit – in a serious accident the two together can easily exhaust it. The other is that, under the policy conditions, a serious or repeated breach of occupational safety rules may lead to the insurer being released from paying; the burden of proving this lies with the insurer, but a missing training log or risk assessment makes that proof easy. The wording of the policy decides – of the five steps of reading policy conditions, the chapters on exclusions and limits are the ones that matter here.
If the payment order has arrived
First check the deadline and bring in a lawyer: challenging the payment order is a legal matter, and neither the insurer nor I act in your place in it. At the same time, report the claim to your liability insurer through its claims line or online portal, attaching the payment order, the workplace accident report and the official documents – liability insurance conditions typically require that any claim made against the insured be reported without delay and that liability not be admitted without the insurer's consent. If the case gets stuck with the insurer, or the rejection is open to challenge, I help where I can, acting on the client's behalf: I review the reasoning against the wording of the policy conditions and help structure the request to reopen the case.
Prevention: where occupational safety and insurance point the same way
The reimbursement claim against the employer is tied to a breach of occupational safety rules (or to causing the accident intentionally), so defence starts there too: an up-to-date risk assessment, documented training, protective equipment that is issued and used, maintained machinery, work procedures that are followed. The same points come up in the underwriting and claims settlement of liability insurance. Group accident insurance is a good complement – it pays the employee regardless of liability – but it does not affect the TB claim, as I also described in the overview of group accident insurance. In construction, manufacturing and warehousing this risk is greater than in an office; it is worth building the cover accordingly.
What should you do now?
Take out the policy conditions of your employer's liability insurance and find the line on reimbursement claims by the social security body – cover, clause or exclusion. Check the limit and consider whether, in a serious accident, it would be enough for the employee's loss and the TB claim together. Check whether your occupational safety documentation is up to date, because in a claim it is the company's first and most important evidence. If recourse is an exclusion in your policy conditions, it is worth requesting a clause or a different quote before the renewal date – if you let me know, I prepare the comparison.
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Sources
- Ebtv. – Act LXXXIII of 1997 on the Benefits of Compulsory Health Insurance, Sections 67–68 (reimbursement obligation)
- Kúria (Hungary's supreme court): Summary of decision no. Mfv.III.10.435/2015 on the employer's reimbursement liability under Ebtv. Section 67(1)
- Adó Online: The employer's reimbursement liability for accident benefits
- Sarolta Mádi: The reimbursement claim of the social security body (Miskolci Jogi Szemle – Miskolc Law Review, 2013/1)
- Labour Code (Mt.) – Act I of 2012, Sections 166 and 172 (employer's liability for damage, deduction of TB benefits)
- CoverMe: Employer's liability insurance for companies (the social security reimbursement claim as a cover question)
