Guide to Employers Liability Insurance

This guide has been provided by Peacock Insurance Services.

Most employers are required by law to insure against liability for injury or disease to their employees arising out of their employment. The following guide is intended to help you to understand what is required. It is not a legal interpretation of the Employers’ Liability (Compulsory Insurance) Act and it has no legal status. You should be aware that only the courts can authoritatively interpret the law.

What is Employers liability Insurance?

You are responsible for the health and safety of your employees while they are at work. Your employees may be injured at work, or they or your former employees may become ill as a result of their work while in your employment. They might try to claim compensation from you if they believe you are responsible.

The Employers’ Liability (Compulsory Insurance) Act 1969 ensures that you have at least a minimum level of Insurance cover against any such claims. Employers Liability Insurance will enable you to meet the cost of compensation for your employees’ injuries or illness whether they are caused on or off site. However, any injuries or illness relating to motor accidents which occur while your employees are working for you, may be covered separately by your motor insurance.

Is Public Liability and Employers Liability Insurance the same?

Public Liability Insurance is different. It covers you for claims made against you by members of the public or other businesses, but not for claims by employees. While public liability insurance is generally voluntary, ‘Employers Liability Insurance’ is compulsory. You can be fined if you do not hold a current employers’ liability insurance policy which complies with the law.

How much cover will I need?

You must be insured for at least £5 million. However, you should look carefully at your risks and liabilities and consider whether you need insurance cover of more than £5 million. In practice, most insurers offer cover for at least £10 million. You should bear in mind that the £5 million minimum level of cover includes costs, so you may wish to purchase cover of more than this.

Which insurance companies can sell me employers’ liability insurance?

You must use an authorised insurer. If you do not, you may be breaking the law. You should check that your insurer is authorised before you take out employers’ liability insurance.

Authorised insurers are individuals or companies working under the terms of the Financial Services and Markets Act 2000. The Financial Services Authority (FSA) maintains a register of authorised insurers. You can check whether a company is authorised by searching their register on the FSA website or by telephoning the FSA on 020 7676 1000.

More Information
Peacock Insurance Services is a Commercial Insurance specialist and will be happy to provide you with further information and a quotation to cover you and your business. Click Employers Liability Insurance or Public Liability Insurance today and see how much you could save.