A Guide to Employers' Liability Insurance

Our simple guide details the main features including excess and offers advice on getting employers' liability insurance right. Not only is this cover a legal requirement for most UK businesses with employees but it's a vital cover for protecting your business itself.

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What is employers’ liability insurance?

Most businesses need a combination of different liability and business insurances. Combining these together or finding a suitable packaged policy will often return the best value.

Where public liability insurance provides protection to the public, employers' liability insurance offers a similar insurance for your staff and employees.

If any of your staff suffer an injury, become ill or have an accident as a result of the work they are doing for your business, they may be entitled to compensation and this is what your employers' liability insurance can cover.

An employer has a duty of care to compensate loss or injury of this kind so it is a legal requirement for a business with any number of staff to have minimum of £5 million employers' liability insurance.

Do I need employers’ liability insurance?

If you have contracted employees you will almost certainly need employers' liability insurance.

There are some other occasions that are exempt but these can vary depending of the nature of the work, the relationship, the contract between you and the staff member. Always seek advice before you leave yourself, your business and your employee vulnerable.

Employers' Liability Insurance Excess

The legal minimum cover in the UK £5 million. This means you must be able to pay out up to this amount in compensation claims including costs. The insurance company that provides your cover will pay the full amount in the event in a claim meaning you don’t have to pay an excess or part of the claim.

This is only the legal minimum though and a larger business may require more depending on the nature of the business and the number of employees. If you are unsure to the amount you need, your adviser/broker will ask a number of questions during a quote which will give them the insight into your business which help them to find the right level of cover.

I have my insurance, what now?

When you take out the insurance you will receive an employers' liability insurance certificate. You are required to display this for all of your employees to view. Since 2008 this can also be displayed digitally, although you must be confident all of your employees fully understand how to access it, and where it is.

It is best to display the certificate in a communal space which is accessible to all staff, like a kitchen, hallway or staff room. Most employers have one space in their premises where they display all legal documents including others such as health and safety certificates and fire safety notices.

Get the best value

Most businesses need a combination of different liability and business insurances. Combining these together or finding a suitable packaged policy will often return the best value.

Download the PDF version of this guide here

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