Employer’s Liability Insurance

Nothing beats happiness when you are employed in a good company. Aside from the contract that you’ll be signing with the company, there are also set of benefits given to each employee. Most of the companies are required by the law to provide protection to their employees in case of injuries or diseases may arise during the employment.

What is Employer’s Liability insurance?
Employers Liability Insurance enables the company to meet the cost of damages and fee if the employee has been sick or injured at work caused by the employer. However, in the event of vehicular accidents, this may be covered by your motor insurance.

What does Employer’s Liability Insurance covers?
This covers all the employees whom you have contracted service. Claims made by the members of the public will be covered by Public Liability Insurance.

A person is considered an employee if:
• they signed for a contract of service
• you subtract income tax and N.I. from the money you pay them
• you control them at work as to when, why and how,
• they cannot allow anybody to replace or substitute them when they are not around

You may not need an Employer’s liability insurance if:
• a student is working for you unpaid
• a student is taking an on-the-job training
• you do not deduct income tax
• they can let someone replace them when they are not around\
• they are in business for their personal benefit
• they do not work for you exclusively

What does Employer’s Liability Insurance exempts?
• some organizations financed by public funds
• family businesses, if employees are closely related to the employer such as relatives or family members
• most public organization
• health service bodies
• companies employing owners having 50% share or more

You have to be careful in choosing what insurance company to subscribe. You have to make sure that the insurance company is authorized by Financial Services Authority to avoid breaking the law.

How much coverage is needed?
Employees must be insured at least £5 million. However, some insurers cover of at least £10 million. Once you already have the insurance coverage, make sure that employees can view the insurance certificate in the most conspicuous place. It may be on a paper display or thru intranet or a shared folder on your office network.

What will happen if I don’t have an Employer’s liability insurance?
Companies with no Employment Liability insurance should be careful. The Health and Safety Executive are authorized to inspect if the company has an EL insurance having the minimum cover of at least £5 million. You will be fined an amount of £2500 per day without the insurance properly covered.

It is strongly advised to all companies to have a complete record of your employer’s liability insurance.

You are strongly advised to keep, as much as possible, a complete record of your employers’ liability insurance. It may risk if you for meeting the cost of such claims.