Employers liability insurance in the UK

Employers’ liability insurance is a compulsory requirement for any UK business with staff. It may sound intimidating but fear not - our experts at Dojo have put together this quick guide so you can better understand the essentials about employers’ liability insurance, from what it is to who needs it and why.

We'll cover:

• What is employers' liability insurance?
• Who does employers' liability insurance cover?
• What does employers' liability insurance cover?
• How much does employers' liability insurance cost?
• Who needs employers' liability insurance?

What is employers’ liability insurance in the UK?

No matter how safe a workplace may be and with all necessary precautions taken, accidents can still happen. If an employee is injured or cannot work due to an accident or illness in the workplace, Employers’ Liability Insurance covers their compensation, this is also sometimes referred to as an accident at work claim.

Employers are responsible for the health and safety of staff during work hours whilst at work or working and Employers’ Liability Insurance can help safeguard businesses from compensation claims and legal fees.

Note that if your business is facing a claim you should always seek independent, professional legal advice or counsel. You can find out more on GOV.UK here.

Who does employers’ liability insurance cover?

Employers’ Liability Insurance typically covers full-time, part-time, contractors, work experience, apprentices, temporary staff and volunteers. Essentially, anyone who works for your business in any capacity should be covered by EL Insurance in the UK. However, this may differ depending on your cover or the nature of the claim should your business ever be claimed against. You can check with your FCA approved insurance provider for details about your cover.

What does Employers’ Liability Insurance cover?

Employers’ Liability should cover lawsuits, prosecution costs and settlements, including everything from damages to settling any claim from current or ex-employees. Claims made from an accident or incident caused by the workplace should be covered by EL Insurance. However, if your business has been implicated in a claim, you should check your cover details with your insurance provider and seek professional, independent legal advice.

How much does Employers’ Liability Insurance cost in the UK?

As every business is different, so are the costs for EL Insurance. Factors such as your industry, the number of employees and the level of risk will all contribute to how much your Employers’ Liability Insurance will cost. The level of cover you choose will also affect the price.

It’s best to shop around for EL Insurance from different FCA authorised providers to get the best rate and cover for your business requirements.

Who needs employers’ liability insurance?

If you work self-employed and entirely alone then you do not need employers’ liability insurance. Or, if you only employ immediate family members (such as your children, husband, wife, mother or father) then you do not need EL insurance. If your employees are based abroad you may also not need EL. However, anyone with unrelated employees whether that be two or 200, needs this cover as a legal requirement under UK law.

If your business does not have employers’ liability insurance when it should you can be fined £2,500 for every day you are not covered. You can also be fined £1,000 for not showing your EL Insurance when asked to by an inspector.