By Deepak Soni, Head of Direct Commercial at Hiscox

What is employers’ liability?

Employers’ liability is the duty of employers to ensure that your employers are able to work safely and without harm, and the right of employees to be compensated in the event that become unwell whilst working for you.

If your employees were to have an accident or become ill in the course of working for you, they could sue your business for compensation – for example, for lost earnings, medical bills, or emotional distress.

Employers’ liability insurance is a mandatory insurance in the UK, under certain circumstances. If you are required by law to hold this insurance, you will need to hold at least £5m of cover.

What does employers’ liability insurance cover?
• Pays your legal and compensation costs if you are sued by a member of your staff in the event that they believe that their work for you has caused them injury or made them ill
• Covers any person working for you in connection with your business even if they are voluntary help or self-employed
• Claims for injuries or illness caused by terrorism are also covered up to a limit of £5 million

Who needs it?

All businesses in the UK that employ staff are legally obliged to have employers’ liability insurance to provide cover against a claim from an employee. However, there are a number of circumstances in which employers’ liability is not mandatory. Please see below for details.

If you are required to hold employer’s liability insurance, you will need at least £5m of cover and could be fined for every day that you are not insured adequately. At Hiscox, we can also provide limits of £10m.

Is it mandatory?

The law states most employers must have Employers' Liability Compulsory Insurance. However, you may not need it if you have no employees, are a family business and closely related to your staff, or a public organisation (for example, a government department or a health service body). Click here for more information about whether or not the legislation applies to you: Health and Safety Executive.

For more information visit : www.hiscox.co.uk/