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Protect your business from the costs associated with employee illness or injury
As a business owner you will know Employers’ Liability is compulsory if you employ staff. As employers have a duty of care to their workers, the Employers’ Liability Insurance (Compulsory Insurance) Act makes it a legal obligation for you to have this cover. Due to the mandatory nature of this policy you may own the cover, but may not fully understand what it is. Whether you have one employee, a small team or a large staff roster, our handy guide will walk you through all you need to know to about Employers’ Liability, and how you can get the bespoke cover for your needs.
Do I need Employers Liability Cover?
Employers liability is a legal requirement except for the following circumstances:
- A limited company where only 1 person is employed and that person also owns more than 50% of the share capital.
- A company which is not limited and has only 1 employee (sole trader) who is the principal of the business.
- A company which is not limited and of more than 1 employee where employees are close family members.
- Partnerships where the directors are equal partners in the business and do not employ others.
Employers’ Liability provides the minimum level of cover for business owners against compensation claims made by employees who were injured at their place of work. If employees are hurt or fall ill, as a result of their job or being at their work place, then they are well within in their rights to file a claim. Employers’ Liability will ensure you are in a position to cover the costs that can be incurred when a compensation claim is made against you. This includes fines and legal fees that can result if the claim is taken to court. Even a former employee can file a claim, if an injury or illness occurred while in your employ, if health and safety rules were not properly applied.
Our Employers’ Liability policy comes as standard with our main Public Liability Insurance package, which is similar to Employers’ Liability, but not to be confused with it. Where Public Liability is for covering businesses against general public claims, Employers’ Liability is solely for cover against claims made by staff. It is important to remember that it is illegal for employers to hold an insurance policy that does not include Employers’ Liability cover.
Once a policy is taken out, an Employers’ Liability insurance certificate is issued and a copy must be displayed where it can be read by all staff members. The original certificate must also be made available to Health and Safety Executive Inspectors for them to check. Failure to do so can result in a fine of £1000. Due to former employees being able to make claims retrospectively, employers must hold copies of their certificates for at least 40 years, as some diseases or other medical conditions can develop years after they were first caused.
This liability doesn’t stop with employees based in England, Scotland and Wales, but also applies for offshore installations, like oil rigs. The only exception is for employees based abroad. In such cases, employers must make efforts to check the laws in the respective countries where their workers are based.
Cover is subject to insurers underwriting criteria, policy terms and conditions available on request.
Find further information here on Public Liability Insurance or speak to one of our RAC advisers on 0344 892 1757 to get a quote.