We answer your questions on Employers Liability insurance


Employers liability is an essential insurance policy for a business that depends on staff to function. Of course, a variety of businesses fit this description and there are many claims that employees can make against their boss – which is why, it’s important to select the right employers liability coverage for your company and seek the advice and guidance of an expert, such as Rigby Financial.

Our insurance advisors demonstrate strong knowledge in this area and, here, they have put together a list of frequently asked questions about employers liability insurance and what it involves.

Frequently asked questions about employers liability insurance

What is employers liability insurance?

Employers liability insurance is mandatory for most businesses. If you have a workforce of any kind, you are responsible for their health and safety and you need to be prepared for the worst. Accidents do happen. Employees may be injured at work or become ill as a result of the work they do and, in such situations, they are entitled to make a claim. This is where employer liability coverage comes into play. The policy will cover the cost of compensation up to a specified amount.

Do I need employers liability coverage?

If you employ staff as part of your business, the answer is yes – you must have employer liability insurance. Failure to do so will result in a substantial fine. The Health and Safety Executive (HSE) will charge you £2500 for every day you continue to run your company without insurance. You may also be fined £1000 if you fail to show employees and HSE inspectors your existing certificate.

There are some circumstances when employer liability coverage is not essential; for example, if you are a sole trader, a sole company director (with more than half the shares) or running a limited company without employees. However, even in these circumstances, you may find that some clients will stipulate employer liability insurance as a necessity within their contract.

Who counts as an ‘employee’?

It sounds like the answer should be simple – an employee is someone that works for you – but this is something you need to consider carefully before choosing employers liability insurance.

Different rules apply to different types of businesses. For example, if you’re a sole trader, family members do not count as employees. If you run a limited company, they do. In some situations, contractors, subcontractors, freelancers, and interns can all be considered employees. Even temporary staff, who have worked for you for a few hours, fall under the same category.

There’s a lot to think about and, if you’re unsure about whether your workers are ‘employees’ – as classified by the HSE – it’s worth seeking the advice of a professional broker, such as Rigby Financial.

How much cover will I need?

The absolute minimum amount of cover, specified by the HSE, is £5 million. However, most insurance providers usually offer £10 million as part of their standard employers liability coverage. It’s also important to consider the risks associated with your business – and determine if this figure would be enough to cover the cost of compensation.

How much does employer liability insurance cost?

The cost of employer liability insurance is dependent on a number of variables, including the size of your company, the number of employees, and the nature of the work. It’s important to discuss these variables with a professional broker and identify the best policy for you and your specific needs.

It’s also possible to bring the cost of the policy down, by keeping your team up-to-date with official advanced health and safety courses, purchasing cover as part of a business insurance package (i.e. in conjunction with public liability insurance) or shopping around for the best possible deal.

Where can I buy employer liability insurance?

Employer liability insurance must be purchased from an authorised insurer – that is, a company who is working under the terms of the Financial Services and Markets Act 2000. Failure to do so may mean you are breaking the law – and the safest option is usually to seek the help of a professional broker, such as Rigby Financial. Our insurance advisors will help to identify the ideal employer liability insurance policy for you and they will recommend a provider that you can trust.

Contact Rigby Financial today

If you wish to know more about employee liability insurance or if you need help seeking out the perfect policy for your company, please feel free to get in touch. Either give us a call on 01744 886077 or send an email to enquiries@rigbyfinancial.co.uk and we will respond as soon as we can.