When should I buy insurance for my domestic helper?

What is domestic helper insurance?

Foreign domestic helper insurance usually refers to insurance products purchased for foreign domestic helpers, mainly including employees' compensation insurance (commonly known as "labour insurance") stipulated in the Employees' Compensation Ordinance (Chapter 282 of the Laws of Hong Kong), and other optional comprehensive protection (such as medical insurance, third party liability insurance, etc.). These insurances are designed to ensure that employers are able to fulfil their legal and moral obligations when their domestic workers are injured, become ill or incur other liabilities due to accidents during their work.

In Hong Kong, foreign domestic workers usually come from the Philippines, Indonesia and other places. They are hired under a standard employment contract (ID407) and their jobs include housework, caring for children or the elderly, etc. The relationship between an employer and a foreign domestic worker is an employment relationship in law, so insurance liability cannot be ignored.

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Why do you need to buy insurance for your domestic helper?

Purchasing insurance for domestic workers is not only a legal requirement, but also has the following practical significance:

Moral Responsibility:
Foreign domestic workers work far away from home to serve their employers, and providing them with appropriate protection is a sign of respect for their labor.

Legal Compliance:
It is illegal not to take out employees' compensation insurance for foreign domestic workers. If discovered by the Labour Department, the employer may be fined up to HK$100,000 and imprisoned for 2 years. More importantly, if a foreign domestic worker is injured at work, the employer will have to bear the compensation costs, which may be as high as millions of Hong Kong dollars.

Risk Management:
Foreign domestic workers’ jobs involve certain risks, such as falling while cleaning high places, burns while cooking, or occupational diseases (such as arthritis in the hands) due to long-term labor. Insurance transfers these risks to an insurance company.

Medical Insurance:
The standard contract requires employers to provide free medical care for domestic workers. If a domestic worker becomes sick or injured, the medical expenses can be high. Comprehensive insurance usually includes outpatient and inpatient coverage, reducing the burden on employers.

Mandatory legal provisions:
According to the Hong Kong Employees' Compensation Ordinance (Chapter 282) and the Immigration Ordinance, all employers who employ foreign domestic workers must purchase two types of insurance:

Labor Insurance (commonly known as "Employee Compensation Insurance")：Covering medical expenses and compensation for foreign domestic workers who are injured at work or suffer occupational diseases during their work.

Medical insurance required by domestic helper contracts:
According to the standard employment contract (ID407), the employer is required to bear the medical expenses of the foreign domestic worker, usually by purchasing medical insurance to fulfill this responsibility. Consequences of not purchasing insurance:

The maximum penalty is a fine of HK$100,000 and imprisonment for 2 years (Section 40 of the Employees’ Compensation Ordinance).

Foreign domestic worker visa applications may be rejected or employers may be blacklisted by the Immigration Department.

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In practice, employers usually purchase insurance for their domestic workers at the following stages:

Here are some specific suggestions for different scenarios:

1. Newly hired domestic helpers

• Foreign domestic helperAfter signing the contractBefore arrival: After signing a contract with a domestic helper agency, the employer should complete the insurance before issuing a work visa (such as ID988A) to the domestic helper to ensure that the visa application goes smoothly.
• Before the domestic helper arrives in Hong Kong: If the domestic helper has not yet arrived in Hong Kong, the insurance can be set to a future effective date (usually the day the domestic helper arrives in Hong Kong).
• Before policy expiry: You need to renew your insurance in advance to avoid interruption of coverage.
• opportunity: Purchase after signing the standard employment contract (ID407) and before or at the same time as submitting your visa application.
• reason: The Immigration Department may require proof of insurance policy, and the foreign domestic helper may start working immediately after arriving in Hong Kong, so the insurance must take effect immediately.
• Practical suggestions: When hiring a domestic helper through an agency, the agency will usually arrange insurance for you. Employers should confirm that the policy effective date coincides with the domestic helper’s arrival date in Hong Kong.

2. Re-employment of domestic helpers

• opportunity: Purchase a new policy at least 1 month before the existing contract and policy expire. You need to ensure that the original policy covers the new contract period, or purchase new insurance.
• reason: Ensure seamless insurance coverage to prevent domestic helpers from working without protection.
• Practical suggestions: Contact the insurance company or intermediary in advance to confirm the renewal procedures and update the domestic helper’s information (such as salary adjustments).

3. Replacement of domestic helper

• opportunity: After the new foreign domestic helper signs the contract and before arriving in Hong Kong.
• reason: After the old foreign domestic worker leaves, the new domestic worker’s insurance needs to be purchased independently and the original policy cannot be transferred.
• Practical suggestions: If the old policy has not expired, you can apply for cancellation or premium adjustment.

4. The domestic worker quits or is fired

• opportunity: There is no need to purchase new insurance immediately after a foreign domestic worker leaves the job, but insurance is required before the new foreign domestic worker arrives in Hong Kong.
• reason: The insurance is tied to a specific foreign domestic worker and the policy becomes invalid after the domestic worker leaves the job.
• Practical suggestions: Contact the insurance company to cancel the policy and request a refund of the remaining premium.

5. Before policy expiry

• opportunity: Renewal is required in advance
• reason: Avoid interruptions in protection and face legal and economic risks.

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Types and coverage of domestic helper insurance

Labor Insurance (Employees Compensation Insurance)

• Coverage:
  • Medical expenses, hospitalization expenses, and rehabilitation expenses for work-related injuries or occupational diseases.
  • Income compensation for domestic workers who are unable to work due to injury (usually 80% of monthly salary).
  • Statutory compensation for permanent disability or death (calculated in accordance with the Schedule to the Ordinance).
• Insurance coverage requirement:
  • The law does not stipulate a minimum insurance amount, but it must be sufficient to pay statutory compensation. The industry generally recommends that the insurance coverage should not be less than HK$100 million.

Medical Insurance

• Coverage:
  • Outpatient, hospital and surgical expenses (some plans cover dental and vision care).
  • Prescription medicines and diagnostic tests (such as X-rays, blood tests).
• Common insurance coverage:
  • The annual limit is usually between HK$10,000 and HK$50,000, and can reach over HK$100,000 for premium plans.

Third-party liability insurance (optional but recommended)

• Covers property loss or personal injury caused by the domestic helper’s negligence (such as damaging a neighbor’s belongings while cleaning).

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Specific procedures and documents for purchasing insurance

Choosing an Insurance Company

• Major insurance companies in Hong Kong (such asHSBC,Prudential,AIG) both offer domestic helper insurance packages.
• Key points for comparison: premiums, compensation limits, deductibles, network hospital coverage, and claims efficiency.

Required Documents

• Proof of employer’s identity (Hong Kong Identity Card or Passport).
• A copy of the domestic helper’s passport and visa information (such as ID407 contract).
• Proof of employment address (such as a utility bill).

Insurance steps

• Online Insurance: Fill in the information and make payment through the insurance company's website (document upload required).
• Offline Insurance: Contact your insurance broker or bank and sign a paper application form.
• Effective time: Usually 1-3 working days after payment.

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Premium Estimation and Cost Savings Tips

Factors that influence premiums

• The age and health status of the domestic worker (some companies require a medical examination).
• What the benefits are (e.g. whether it covers childbirth, pre-existing conditions).
• The deductible (excess) is high or low.

Annual premium reference Insurance Type Average Annual Premium (HKD) Labor Insurance 800 – 1,500 Basic Medical Insurance 1,200 – 3,000 Comprehensive Plan 2,500 – 5,000

Cost saving methods

• Choose the "Labor + Medical" package (usually discounted by 10-15%).
• Increase the deductible (e.g. HK$50 for outpatient treatment).
• Take out insurance through hiring an intermediary group (enjoy group rates).

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The consequences of not purchasing insurance

If the employer does not purchase employees' compensation insurance for their domestic helpers, they may face the following risks:

1. Legal consequences:
   Violations of the Employees' Compensation Ordinance may result in fines and imprisonment. The Labour Department regularly checks employers' compliance.
2. Economic risks:
   If a foreign domestic worker is injured at work, the compensation amount may be as high as millions of Hong Kong dollars. For example, if a foreign domestic worker falls from a building and becomes paralyzed, the employer will be required to pay for medical expenses and lifelong compensation.
3. Visa issues:
   Failure to purchase insurance may affect the renewal or new application of the domestic helper visa.
4. Moral pressure:
   If foreign domestic workers are unable to obtain compensation due to lack of insurance, it may lead to disputes or even lawsuits.

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Frequently Asked Questions

Appendix and Resources

Official agency contact

• Employees' Compensation Division, Labour Department: +852 2717 1771
• Insurance Authority:https://www.ia.org.hk

Immigration ServicesForms for Employing Foreign Domestic Helpers

https://www.immd.gov.hk/hkt/forms/hk-visas/foreign-domestic-helpers.html