Employers' liability insurance

Employers’ liability insurance protects your business from staff injury or illness claims. 

Buy employers’ liability (EL) insurance with your Hiscox public liability cover. This cover offers peace of mind over work-related employee illness or injury claims. It’s also likely to be a legal requirement (external link), as per UK law. 

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Cover full-time and part-time staff. And claims by volunteers, students and UK subcontractors.

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What is employers' liability insurance?

Employers’ liability insurance is a type of business insurance that can help protect you against staff claims following accidents at work or work related illnesses. It can also be a legal requirement in the UK. This applies to most businesses with employees. 

Claims may include: 

  • Compensation claims due to an employee injury 
  • Lawsuits about work-related illness.

A business without the right cover could risk a fine. The Employers’ Liability Act sets out the rules.
Liability cover can be useful in many cases:

  • Your receptionist might slip on a wet floor
  • An employee may fall ill due to risks of the job.

You do all you can to prevent accidents and look after your staff. But things can happen unexpectedly.
An employers’ liability policy helps to cover legal and compensation expenses.

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Employers' liability – our guide

Do I need employers' liability insurance?

If your business is based in the UK and you employ staff, you might need employers’ liability insurance by law. 
Whether you have one person on your books or a whole team, under UK law (external link) your business could be fined up to £2,500 for each day it isn’t covered with the right insurance. 

This could apply to you as soon as you take on your first hire. They might be a:

  • Full-time employee
  • Part-time employee
  • Friend pitching in.

Having a policy is a legal requirement (external link) for most businesses. But there are a few exceptions

Who is usually exempt from employers’ liability insurance?

You usually aren’t legally obliged to have this cover if you’re a:

  • Public organisation
  • Health service body
  • Small business that only employs close family members.

Note that this doesn’t include family businesses incorporated as limited companies.

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What does employers' liability insurance do?

An employers’ liability insurance policy can help with legal costs or compensation you may have to pay if an employee’s claim goes to court. This applies up to the policy limit.

You give training and are committed to health and safety. Still, accidents can happen. As an employer, you may need to pay damages. Or defend yourself.

You can also face claims from people who have stopped working for you. An employers’ liability insurance policy can help.

Who does employers’ liability insurance cover?

Employers’ liability insurance covers your business and can help with claims relating to people who work for you or have previously worked for you.

An employers’ liability policy can cover claims from*:

  • Permanent employees
  • Contracted employees
  • Seasonal or temporary staff
  • Voluntary staff
  • Interns
  • Apprentices and students 
  • People on work experience
  • Labour-only subcontractors.

*Note: this list is not definitive or exhaustive. Call us to get more information on your specific circumstances.

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How much employers' liability cover do I need?

How much employers’ liability cover you need depends on:

  • How many employees you have
  • What you do
  • The size of your business
  • What you might be liable for.

It’s not just employees and contractors to consider. It’s anyone working for you in any capacity. 

Trainees and apprentices, or even just a friend helping. No matter how small your business, you could be liable if they were hurt.

The legal requirement for EL insurance is £5m. We offer to cover you up to £10m. You can work with confidence while we protect your bottom line.

Our business insurance policies start from £8.40*.

*Figures based on an average of all business insurance policies sold to at least 10% of our customer base between January 2023 and January 2024.

What's included in your employers' liability cover?

An employers’ liability insurance policy includes cover for legal and compensation costs. It protects from claims made against you, up to £10 million.

The policy provides cover to your business for:

Employee illness claims 

Employers’ liability insurance can help if staff say their job caused an illness.

The Health and Safety Executive (HSE) (external link) lists types of workplace illness.

Employee injury claims

Say employees are hurt because of their work for you. Employers’ liability insurance could help with legal defence and compensation costs. 

This might apply if:

  • Stock is stored unsafely and falls on to someone
  • Manual handling training isn’t given, and a staff member hurts their back
  • Employees trip on uneven flooring in your office.

Long-term employee health claims 

Some employee claims span a longer timeframe. Employers' liability insurance could help.

This might apply if:

  • An employee loses their hearing due to noisy machinery at work.

Claims from ex-employees

Employers’ liability claims may come later. If an ex-employee makes a claim, insurance could help. This applies if you were insured with us at the time of the alleged accident or exposure.

Claims from temporary staff

On the flipside, some problems strike fast. Say someone works for you for one day. They trip when leaving. They might try to claim. 

Employers’ liability cover can help against claims from: 

  • Permanent staff 
  • Temporary staff
  • Casual staff.

Criminal action for breaching employment laws

Some disputes may relate to how you applied laws and regulations. 

This cover may help if a:

  • Staff member becomes ill or injured
  • Government or regulatory body starts criminal proceedings against you for this
  • Representation is required at any subsequent investigation, inquiry or coroner's inquest.

Please refer to the policy wording for the full details of inclusions and exclusions of this cover. Contact our customer services team for more information.

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What does employers’ liability insurance not cover?

We will not make any payment for:

  • Injuries caused by a vehicle where motor insurance is compulsory
  • Any deliberate or reckless acts
  • Injuries occurring while travelling to, on board, or returning from an offshore rig or platform
  • For the full details of what's not covered, see your policy documents.

Please refer to the policy wording for the full details of inclusions and exclusions of this cover. Or contact our customer services team for more information.  

Employers' liability insurance FAQs

Who is liable for workplace health and safety?

As an employer, you are responsible for the health and safety of your staff while they are at work. Say an employee suffers an injury or falls ill due to their work for your business. You could be liable. This might mean paying compensation.

Read more in our small business health and safety guide.

When should I get employers’ liability insurance?

You might need employers’ liability insurance as soon as you take on your first member of staff. If you run a limited company and employ anyone, in any capacity, it may be a legal requirement.

Even as a sole trader or freelancer, you may one day hire staff to help at a busy time.

What is the difference between public liability and employers’ liability?

The difference between these business insurance policies is where the claim comes from. If it comes from a person from outside your business, you’ll use public liability cover. If they work inside your company, you’ll use employers’ liability insurance.

What are some real-life examples of Hiscox employers’ liability claims?

Before you take out a policy, you might want to learn about making a claim. That’s why we’ve collated real-life claims stories

One case saw a volunteer trip and sustain an injury, which lasted for over a year. Our customer had the right policy in place. This helped to defend them and pay out as required. So, both parties were covered.

Who is usually exempt from employers’ liability insurance?

You’ll usually be exempt from employers’ liability insurance requirements if:

  • Your business has zero (0) employees
  • Your limited company employs only one person, yourself. And you also own more than half the firm’s share capital
  • You’re a sole trader
  • You run a family business. This means you employ only close relatives. Say, your husband, wife, son or daughter. The family business exemption is not designed for limited companies.

To find out more about the rules and what they might mean for you, research can help. Try the:

Is employers’ liability insurance tax deductible?

Yes, employers’ liability insurance is tax deductible. This is because it’s classed as an allowable expense (external link). Keep your payment records. Then, you can list this as a deductible cost when you calculate your profits. This might mean you pay less corporation tax.

You’ll also need to report the costs (external link) at the end of each tax year. This is because this type of insurance can benefit employees.

Should my EL policy details be available to my staff?

The Financial Conduct Authority (FCA) (external link) instructs firms to make their policies searchable. This has applied since 2011. It lets current and former staff check for employers’ liability policies. 

To meet this need, some firms may be required to join the Employers’ Liability Tracing Office (ELTO). For this, they submit all relevant gross written premium (GWP) details since March 2011. Plus details about claims. Businesses may need to pay a membership levy to benefit from this service.

How can I pay for employers’ liability insurance?

Pay for your Hiscox EL cover with a:

  • Debit card
  • Monthly direct debit
  • Yearly direct debit.

You can cancel any time, without a fee.