If you employ staff then it's vital that you take out employers' liability insurance for your business.
What is employers liability insurance?
If you have employees, including those on a part-time or a short-term basis, you must buy employers' liability insurance.
If you don't buy employers' liability insurance it's likely you are breaking the law as it's a legal requirement for most multi-person businesses and you could be fined up to £2,500 per day by the Health and Safety Executive.
Employers' liability insurance protects you if an employee becomes ill or is injured because of their work.
An employee may make a compensation claim against you and this insurance will cover the legal costs of defending the claim as well as any compensation that is due. Here, the employers liability insurance cost is likely to be significantly lower than the benefit if your policy were to pay out.
The most notable claim made under an employers' liability insurance policy was the Piper Alpha oil rig disaster of 1988. An explosion and subsequent fire resulted in the death of 167 people and directly resulted in changes to employer's liability insurance limits.
If you employ staff you are required by law to take out a minimum of £5 million of employer's liability insurance cover. Many companies choose to take out a limit of £10 million of public and employers liability insurance although some larger companies buy significantly more cover.
How to buy employers public liability insurance
There are two main ways that you can buy employers public liability insurance:
As a stand-alone policy
Include it within more general employers insurance
When you are looking for an employer liability insurance quote it is worth comparing the cost of a stand-alone policy and the employers liability insurance cost of including it within a more general employers insurance policy.
For example, you can often buy employers' liability insurance alongside public liability insurance (which protects your business against claims from the public for injury or property damage as a result of the operation of your business), buildings and contents insurance or professional indemnity insurance.
When you analyse an employer liability insurance quote, make sure that it provides sufficient cover. Many insurers have maximum limits on the amount of employers' liability protection they will offer - often £5 million or £10 million. Make sure you get the appropriate amount of cover for your business.
You will also need to check the terms and conditions to find out whether there are any specifics you need to adhere to in order to ensure the policy remains valid, and if there are any up-front exclusions that could affect whether the policy is suitable for you and your company.
Take out the policy that offers you the most appropriate level of cover for the best possible price.