The moment you become an employer in the UK, you must legally take out an Employer’s Liability policy that covers you for at least &5 million. That is a large amount of money, and should be a strong indication of how serious it can be if an employee is injured due to negligence on your part.

In fact Employer’s Liability is a legal requirement in the UK. You can be fined up to &1000 if you fail to show inspectors your EL certificate, and failure to have an adequate policy in place can see you being charged &2500 a day in fines.

However, much like car insurance, if an accident takes place you will be glad you have employer’s liability in place.

What is Employers’ Liability and what does it cover?

Employers’ Liability Insurance is one of the main types of business insurance. Should you be drawn into a lawsuit by an employee or ex-employee for illness or injury caused by their work, an Employers’ Liability policy can assist with the payment of compensation costs and legal fees.

For example, an employee is injured when they trip over a trailing cable in the office and makes a compensation claim against their employer. The court can order the employer to pay compensation for injury, costs and other damages, which could cost a company tens of thousands in payouts. Employers’ Liability covers the cost of all the financial ramifications.

How much does employers’ liability insurance cost?

As with all insurance, the price will depend on your circumstances, such as the number of employees you have and the type of business you run.

How much employers’ liability insurance do I need

The legal minimum amount you should have is &5 million, however, most insurers will offer &10 million of cover as a standard.