Question 1

Is employers' liability insurance a legal requirement?

Accepted Answer

For most UK businesses that employ staff, yes. The Employers' Liability (Compulsory Insurance) Act 1969 requires employers to hold a policy with an authorised insurer, with a minimum indemnity limit of £5 million for any one occurrence. A small number of narrow exemptions exist — for example, certain limited companies whose only employee is a director owning 50% or more of the share capital, and some family-only businesses that are not incorporated. The exemptions are narrower than many business owners assume, so it is worth checking your specific position rather than relying on a general rule.

Question 2

Is "employees liability insurance" the same as employers' liability insurance?

Accepted Answer

Yes — they refer to the same cover. "Employees liability insurance" is a common way of searching for it, because the policy responds to claims brought by your employees. The correct name is employers' liability insurance, because it is the employer who holds the policy and the employer against whom the claim is made. If you have been asked for employees liability insurance by a client or a contract, employers' liability cover is what is being requested.

Question 3

Who counts as an employee for employers' liability purposes?

Accepted Answer

The definition is broader than a formal contract of employment. It typically includes full-time and part-time staff, temporary, casual and seasonal workers, people on zero-hours arrangements, apprentices and work experience placements, volunteers, and labour-only subcontractors who work under your direction using your equipment or materials. Working directors and family members employed by the business are frequently in scope too. Genuinely self-employed contractors who carry their own cover are usually outside it. Because the boundary matters, we go through your working arrangements with you before approaching insurers.

Question 4

How much employers' liability cover do I need?

Accepted Answer

The 1969 Act sets a statutory minimum of £5 million for any one occurrence. In practice most UK insurers provide a £10 million limit as standard, which reflects typical market practice rather than a legal requirement. Businesses with larger workforces, higher-hazard operations, or contractual obligations may want to discuss a higher limit. We can talk through what is appropriate for your operation and approach insurers on that basis.

Question 5

What happens if a business does not hold the insurance it is required to hold?

Accepted Answer

The Health and Safety Executive enforces the requirement. As a factual statement of the penalty regime: an employer that is required to hold cover but does not can be fined up to £2,500 for each day it is uninsured, and up to £1,000 for failing to display the certificate of insurance or to produce it to an inspector on request. A criminal fine is not something any insurance policy can pay — fines and penalties are uninsurable under English law. An uninsured employer would also have to meet any employee claim from its own resources.

Question 6

Do I need employers' liability insurance for subcontractors?

Accepted Answer

It depends on the working relationship rather than the label. Labour-only subcontractors — those working under your direction, typically using your tools and materials — are usually treated as employees for these purposes and should be declared to your insurer. Bona fide subcontractors who run their own business, carry their own employers' liability and public liability cover, and control how the work is done are generally outside your policy. Getting this wrong is a common cause of declined claims, so it is worth being precise about it when cover is arranged.

Question 7

What does the employers' liability certificate have to show, and where must it go?

Accepted Answer

Your insurer issues a certificate showing the insurer, the policy number, the period of insurance, and the employers covered. It must be made available to employees — displayed at the workplace where they can read it, or provided electronically in a form they can access. A Health and Safety Executive inspector may ask to see it. Although the 40-year retention rule was removed in 2008, the HSE advises keeping old certificates indefinitely, because industrial disease claims can surface many years after the exposure that caused them.

Question 8

What is the difference between employers' liability and public liability insurance?

Accepted Answer

Employers' liability responds to claims from your own employees who are injured or made ill by their work. Public liability responds to claims from third parties — customers, clients, visitors, and members of the public — for injury or property damage caused by your business activities. Employers' liability is compulsory for most employers under the 1969 Act; public liability is not compulsory, but it is very commonly required by contracts. The two are frequently arranged together, often within a single combined business policy.

Question 9

How do I arrange employers' liability cover through Focus Insurance?

Accepted Answer

Call us on 01733 263311 or request a call-back. We will ask about your employees, wageroll, trade, use of subcontractors, and claims history, then approach our panel of insurers on your behalf. We are a broker, not an insurer — cover is subject to insurer acceptance, underwriting, terms, conditions, limits, and exclusions.

Employers Liability Insurance