Why you need employers liability insurance

insurtance policy

Businesses that employ staff including volunteers, sub-contractors and work experience placements, are legally required to ensure that they have employers’ liability insurance.

According to the Employers’ Liability (Compulsory Insurance) Act 1969 employers are responsible for the health and safety of their employees whilst at work. If an accident were to occur where an employee was injured, made ill or suffered damage to their personal property and it is believed that you or your business operations were the cause, the employee could try to claim compensation from you.

In instances such as these, if you were found liable you would be expected to pay any damages, compensation and legal fees; this is why having the right insurance in place is essential.

Accidents can happen any time, anywhere and if you have employees chances are they may spend a lot of time at your place of work. In this instance, an employee could have any number of unfortunate accidents which could result in devastating injuries. If an employee were to suffer a work-related illness, such as asbestos poisoning, they would be entitled to enter a claim against your business for compensation. This is applicable to both current and past employees.

Employers Liability (Compulsory Insurance) Act 1969 requires all employees to have at least £5 million of cover but most insurance companies offer £10 million of employers’ liability insurance as standard.

The Law

It is a legal requirement for a business with any number of employees to hold employers liability insurance. There are very few exceptions, one being if your business is unincorporated and you only employ close family members.

Please note: If you are found trading without the required liability insurance you could be faced with heavy fines. If you fail to obtain valid employers liability insurance, you could be faced with fines of £2,500 for every day you have traded without it. You could also be fined up to £1,000 for not displaying the certificate of employers’ liability insurance.

You will receive the certificate of employers’ liability insurance on purchase of a policy which must be displayed to your employees at all times. The Employers’ Liability (Compulsory Insurance)(Amendment) Regulations 2008, states that this can now be displayed in an electronic format, as long as it is reasonably accessible to employees.

More Information and Quotes

This guide is part of our series on employers liability insurance, for product information, links to more guides or to get a quotation, please visit our employers liability section here.

You can also call our UK based insurance executives on 08081686868.