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Employers' liability insurance is not always required in certain situations. You may be exempt if you only employ close family members (such as a spouse, parent, or child) and your business is not a limited company. Sole traders without employees, certain public bodies, partnerships with equal partners, or employees working abroad under non-UK contracts may also be exempt. However, even if you're exempt, it's still worth considering employers' liability insurance for the added protection it offers against unexpected risks and claims.

The amount of employers' liability insurance you’ll need depends on several factors, including the size of your business, the industry you operate in, and the level of risk associated with your employees’ roles.

Here’s how to determine the right level for your business:

Legal requirement: By law, you must have a minimum of £5 million in coverage if you employ anyone (other than immediate family). If your business is likely to encounter risky situations — as can happen in sectors like construction or manufacturing — you may need more coverage.

Number of employees: Larger businesses with more employees may need higher coverage to ensure all members of staff are protected. 

Potential claims size: If your business deals with high-value claims, or operates in an industry that is prone to expensive lawsuits, it’s probably worth considering a higher coverage level.

Additional coverage: You might also want to consider adding extra coverage, such as public liability, for even more comprehensive protection and extra peace of mind. It’s important to carefully assess the unique risks associated with your business before choosing a policy. 

A policy typically lasts for 12 months, and will nearly always come with the option to renew at the end of the term. Your insurer will usually contact you around 30 days prior to the policy expiring to remind you and offer renewal options. This is a good opportunity to review the policy to ensure it’s still fit for purpose; if you’ve hired more staff, or the business has taken on new responsibilities, you may need to update or adjust your coverage.

If you’re legally required to have employers’ liability insurance but don't secure adequate cover, you could be fined up to £2,500 for each day you operate without it. This applies even if your employees are temporary, part-time, or casual workers. You can also be fined £1,000 if you fail to display your employers’ liability certificate or refuse to make it available to inspectors upon request.

Public liability insurance covers claims made by third parties — generally customers or members of the public — for injuries or property damage caused by your business activities. Employers’ liability insurance, on the other hand, covers claims made by employees who are injured or become ill as a consequence of carrying out their work. This type of insurance is very often a legal requirement if you employ staff (though there are some exceptions), and ensures you’ll be protected if an employee files a claim for any workplace-related incident.

Yes – you need to display your employers' liability insurance certificate in a prominent place where it can be easily seen. This can be a physical copy displayed at your workplace — staff room, kitchen, reception area — or can be digital, as long as it is readily accessible to employees. A failure to display the certificate or make it available to inspectors upon request could result in a fine of up to £1,000.

No, you don’t have to pay an excess to claim on your employers' liability insurance. The policy is designed to cover the cost of compensation and legal fees if an employee makes a claim against you, ensuring your business is protected without any additional expenses.

You need employers’ liability insurance as soon as you hire employees, even if they’re temporary, part-time, or contractors. The policy must be provided by an authorised insurer. This insurance protects your business by helping to cover compensation costs if an employee is injured or becomes ill as a result of their work.

Yes – employers' liability insurance is required if you have paid staff, volunteers, apprentices, or work experience placements. Even if your team members are unpaid, they’re still considered employees under the law, and as a result you and the business have a duty of care to provide a safe working environment.

Yes, employers' liability insurance will typically cover a claim made by a former employees, provided the incident in question occurred while they were employed by your business. For example, if a former employee develops a workplace-related illness or injury after leaving your company, they may still be in a position to file a claim.

It's important to note that coverage will apply to incidents that occurred during the active policy period, so maintaining continuous coverage is crucial. Additionally, some policies may include specific conditions or timeframes for reporting incidents, so always check your policy details to ensure you're protected over the long term.

Yes, employers' liability insurance is typically required for remote workers if they are still considered employees of your business. It covers work-related injuries or illnesses, even if the work is done remotely. The requirement remains the same regardless of whether employees work in-office or from home, so long as they are on your payroll.

Be sure to check specific local regulations to ensure full compliance.