What is Employers’ Liability Insurance?
Employers’ Liability Insurance, also known as EL insurance, is a type of insurance policy that is designed to protect employers’ against financial losses that may arise as a result of legal claims made against them by their employees. In the UK, employers’ are legally required to have EL insurance if they employ anyone, even if it’s just one person.
So, what are the key benefits to Employers’ Liability Insurance?
1. Legal Compliance
Employers’ Liability insurance is a legal requirement for businesses operating in the UK. Under the Employers’ Liability (Compulsory Insurance) Act 1969, all employers are required to have this type of insurance. Failure to comply with this law can result in hefty fines and even criminal charges. You could be fined up to £2500 for each day your business does not have insurance. By having employers’ liability insurance, businesses can demonstrate their compliance with the law and avoid any legal problems.
2. Financial Protection
If an employee is injured or becomes ill as a result of their work, they may be entitled to compensation. The cost of such compensation can be significant, and it can cause severe financial strain on businesses. Employers’ Liability insurance can help businesses mitigate this risk by providing financial protection against any claims.
3. Employee Welfare
Employees expands to more than just people “on the books”. It could expand to volunteers, work experience, and labour only subcontractors. Basically, anyone that an employer would give instruction to. Employers’ have a legal and moral responsibility to ensure the safety and well-being of their employees while on the job. Employers’ Liability insurance helps employers meet this responsibility by providing compensation to employees who suffer injury or illness while at work. This can help employees recover from their injuries and return to work when they are fit to do so.
4. Peace of Mind
Businesses can have peace of mind knowing that they are protected against potential financial losses resulting from employee injury or illness during their work activities. This can help businesses focus on their core operations without worrying about potential legal or financial issues. Be aware that this benefit would not extend to incidents related to a motor vehicle, this should be picked up under a Motor policy.
5. Improved Business Reputation
Having employers’ liability insurance can help improve a company’s reputation. By demonstrating a commitment to the welfare of their employees, businesses can attract and retain customers who value ethical business practices. Additionally, businesses that have this type of insurance are viewed as more reliable and professional by potential business partners, investors, and suppliers.
It’s important to note that EL insurance policies generally do not provide coverage for claims made by self-employed individuals, contractors, or freelance workers. These individuals are considered to be working independently and are therefore responsible for their own insurance coverage.
Employers’ liability insurance provides a very important level of protection for a business and its employees. The advantages of this cover stretch far and wide, with benefits including meeting your legal obligations, ensuring financial protection for your business, and providing security to your employees in the face of personal loss or injury.
Here at 1st Choice Insurance, we can provide employers’ liability coverage for your business, with products available on a stand-alone basis or integrated into business insurance policies.
If you want to ensure full protection against all eventualities, contact our skilled team on 01743 770500 or you can fill in our get a quote form.