Employers' liability for small businesses

What is employers' liability insurance?

Employers' liability insurance covers your small business if a claim is made against you for injury or illness. During a court hearing, the judge could make an order for you to pay compensation, injury, legal costs and other damages. You might have to pay for medical care and a loss of income if the employee is out of pocket.

Get employers' liability insurance for your small business from our insurance partner Markel Direct and:

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Do I need employers' liability insurance cover?

There is a legal requirement in the UK for most businesses that have employees to hold employers’ liability insurance. This applies to various types of workers, including full-time, part-time and seasonal staff.

Claims related to workplace injury or illness can be made many years after employment has ended. In some cases, claims have been brought up to 40 years after an individual has left a business.

The legislation was introduced to ensure that financial responsibility for certain work-related illnesses or injuries sits with the employer, even when the effects are not identified until later in life.

Most employers are required to have a minimum of £5,000,000 of employers’ liability cover. Businesses that do not comply with the legislation may be subject to fines of up to £2,500 per day. An exception exists where a business is not a limited company and only employs close family members, in which case this requirement does not apply.