Door saying "Come on in, we are hiring" Do you need Employers' Liability Insurance?

Do I need Employers’ Liability Insurance?

Most businesses that employ staff either on a full or part time basis should have Employers’ Liability Insurance not only because it is a legal requirement but because it makes good business sense and demonstrates you take the welfare of your staff seriously.

The definition of employing staff applies to casual, seasonal, temporary or contract workers as well as sub-contractors.

As this is a legal requirement there are penalties for businesses that do not comply with the regulations, the penalty for employing staff and not having Employers’ Liability Insurance is a fine of upto £2,500 per day for each and every day that you don’t have the cover!

What does Employers’ Liability Insurance cover me for?

Your policy will cover you for compensating employees who are injured at work or who become ill through work undertaken giving real peace of mind for you and your staff.  As well as covering compensation the policy will also include the cost of legal fees which could be quite substantial.

How much cover do I need to have?

The legal minimum level of cover is for £5,000,000 although it is very common practice for Insurers to issue policies with a limit of £10,000,000.

I think my business might be exempt from the requirement to have Employers’ Liability Insurance

The definition of which businesses are exempt from the legislation is fairly complex but does include companies that have no employees or businesses that only employ family members.  There are a few other exceptions too.

For a more detailed definition you should visit the HSE (Health and Safety Executive) website or read their leaflet on the subject here

How will my staff know that I hold Employers’ Liability Insurance?

When you buy a policy you will be issued with a Certificate of Employers’ Liability Insurance which you should show to your staff members if they ask to see it, you can put this on display at your place of work too although there isn’t a legal requirement to do this anymore it is a nice way to show members of staff and customers that you are a responsible employer.

Some illnesses take a long time to manifest how long do I need to keep the certificates for?

You should try and keep copies of your Employers’ Liability Insurance Certificates for as long as you possibly can.  Your insurer will also register your details with ELTO the Employers’ Liability Tracing Office where a central register of all policies is being collated.  ELTO becomes a legal requirement for insurance companies shortly, you can find out more details about ELTO here

When you register with HM Revenues and Customs as an employer you will be given a reference number called the Employers Reference Number or ERN. It is this unique number that is logged by the insurer with your policy details on the ELTO Register.  We can help you with this and make sure your details are correctly logged.

This new central register will make it simpler to trace cover at a specific time and also where companies have ceased trading and the claim relates to an event that happened in the past.

How much will Employers’ Liability Insurance cost?

The cost of your Employers’ Liability Insurance will depend on how many employees you have, the nature of the work your business does, the turnover of your business and whether you have suffered claims in the past.  That doesn’t mean that the cover will be expensive though, we can talk you through the cover and explain the costs to you.

Would you like to know more about Employers’ Liability Insurance?

We are experienced and friendly insurance brokers and we’d be delighted to have a no obligation conversation with you.  You can call us on 01233 512548 or email If you prefer we can call you, please register your details on our contact form and we call you back.