Employers’ Liability Insurance UK

Reviewed: 17 June 2026

Employers’ Liability insurance protects an employer against certain claims from employees who are injured or become ill because of their work. Most UK employers are legally required to hold this cover.

The legal minimum

Businesses that fall within the Employers’ Liability (Compulsory Insurance) Act 1969 must normally have cover of at least £5 million from an authorised insurer. Many insurers provide a higher standard limit.

Check the current requirements on GOV.UK Employers’ Liability insurance.

Who may count as an employee

The insurance requirement is not determined only by the label used in a contract. The practical relationship matters. Cover may be relevant for full-time, part-time, temporary, seasonal and casual workers, apprentices and some contractors where the business controls how and where the work is performed.

Who supplies the equipment and materials?
Can the worker send a substitute?
How much control does the business have over working methods and hours?
Is the worker integrated into the organisation?
Can the worker refuse work or work for other clients?

Employment and insurance status can be fact-specific, so professional advice may be appropriate where the position is unclear.

Common exemptions

Some businesses may be exempt, including certain companies whose only employee is the owner and holds at least 50% of the issued share capital, and some businesses that employ only close family members. Exemptions have conditions and should not be assumed without checking the official rules.

The insurance certificate

The employer should receive an Employers’ Liability certificate from the insurer. It must be made available to employees, which can normally be done electronically if employees know how and where to access it. The certificate should identify the insured employer and the period of cover.

What the policy may cover

Legal defence costs for covered employee claims.
Compensation for covered workplace injury or illness claims.
Incidents arising from workplace conditions or employment duties.
Claims made after employment ends where the policy responds to the relevant period.

Exact cover depends on the policy wording, insured entities, territorial limits, exclusions and notification requirements.

Insurance does not replace health and safety duties

Employers remain responsible for assessing workplace risks, providing appropriate training and equipment, maintaining safe systems of work and recording or reporting incidents where required. Insurance provides financial protection for covered claims; it does not make unsafe working practices acceptable.

When to review the policy

Hiring the first employee or apprentice.
Using new categories of temporary or contract worker.
Changing business activities or work locations.
Acquiring another business or legal entity.
Expanding overseas or sending employees abroad.
Introducing higher-risk equipment or processes.
Changing the company’s ownership or group structure.

Claims and incident records

Record incidents and preserve relevant documents and evidence.
Follow the insurer’s notification requirements promptly.
Keep historic policy information and certificates.
Coordinate insurance notification with health-and-safety reporting duties.
Avoid admitting liability or settling a claim without checking the policy process.

Related guidance

For other common covers, use the Business Insurance hub. Employers should also review HR Compliance in the UK.

Official sources

This page provides general educational information. Insurance and employment status depend on the facts and policy wording.

Employers’ Liability insurance: compliance workflow

Employers’ Liability insurance helps an employer meet compensation costs if an employee is injured or becomes ill because of work. In Great Britain, most employers must arrange it as soon as they become an employer. The legal requirement is separate from the employer’s duty to prevent harm and manage health and safety.

The core legal requirement

GOV.UK states that an employer must obtain at least £5 million of Employers’ Liability cover from an authorised insurer. The business can be fined £2,500 for every day it is not properly insured. The insurer’s authorisation can be checked through the Financial Services Register.

The policy should cover the correct employing legal entity. A trading name, parent company or group policy does not automatically prove that each employer is insured.

Limited exemptions

GOV.UK identifies limited cases where cover may not be required, including a business that only employs specified close family members or someone based outside England, Scotland and Wales. Exemptions should be checked carefully against the actual relationship and legal structure. A limited company employing its owner-director can require a different analysis from a sole trader employing a close family member.

Do not assume that calling someone self-employed removes the risk. Employment status depends on the real arrangement, and agency workers, labour-only subcontractors or volunteers can raise additional questions.

Certificate duties

The Employers’ Liability certificate must be accessible to employees, for example at the workplace, on a website or through an intranet, and must be shown to inspectors when requested. GOV.UK states that failure to display the certificate can lead to a £1,000 fine. Keep evidence of the certificate and the policy period.

Information to provide at inception and renewal

Legal names of all employing entities
Employee numbers, payroll and occupations
Locations and work away from the premises
Use of labour-only subcontractors, temporary staff and volunteers
Manual, hazardous, overseas or offshore activities
Claims, incidents and health and safety enforcement
Changes in processes, equipment or acquisitions

Information should reflect actual activities. A generic office description may not cover occasional installation, site visits, warehousing or manual work.

Insurance does not replace health and safety

HSE guidance requires businesses to identify hazards, assess risks, provide information and training, consult workers and maintain appropriate arrangements. An insurer may investigate whether the employer complied with policy conditions and legal duties, but cover does not remove those duties.

Employee versus contractor questions

Insurance definitions and employment-law status are not always identical. Review who is treated as an employee under the policy and whether contractors must hold their own cover. Contracts should require evidence where appropriate, but the business should not rely on a certificate where its own working arrangements create employer-like responsibility.

Claims and incident response

Provide immediate medical and safety response.
Preserve the scene, equipment, photographs and witness details.
Complete internal and statutory reporting where required.
Notify the insurer promptly under the policy terms.
Retain risk assessments, training, maintenance and employment records.
Avoid admissions or settlements outside agreed procedures.
Track corrective action so the underlying risk is reduced.

Historical records and long-tail claims

Some occupational illnesses emerge years after exposure. Retain policies and certificates so future employers and employees can identify the insurer that covered the relevant period. Record legal entity changes, acquisitions and business transfers clearly.

Common compliance failures

Insuring the wrong company within a group
Allowing cover to lapse between renewals
Understating payroll or hazardous activities
Assuming family, director or contractor exemptions without checking
Failing to make the certificate accessible
Not notifying an injury, illness allegation or letter promptly
Treating insurance as a substitute for risk assessment and training

Annual review checklist

Confirm which entities employ people.
Reconcile employee numbers, occupations and payroll.
Check the insurer on the Financial Services Register.
Review incidents, claims and HSE action.
Make the current certificate accessible.
Retain expired certificates and policies.
Document any exemption analysis.

Related ASH guides

Official guidance

Remote, home and mobile workers

Employees can be exposed to work-related risks away from the main premises. Describe home working, driving, visits, lone work and customer-site activity accurately. The employer’s health and safety responsibilities continue even when day-to-day supervision is remote.

Employees working abroad

GOV.UK’s exemption wording refers to someone based outside England, Scotland and Wales, but overseas work can raise complex questions about where the employee is based, local compulsory cover and travel or medical arrangements. Obtain specialist advice before relying on an exemption or assuming a UK policy is sufficient.

Business transfers and group changes

When employees move between legal entities, are acquired or transfer under an outsourcing or sale arrangement, confirm which entity employs them and which policy covers each period. Retain predecessor and successor policy details. Historical claims may relate to exposure before the transaction.

Policy-limit and wording checks

Although the compulsory minimum is £5 million, many authorised insurers provide a higher standard limit. The business should confirm the actual limit, territorial scope, definitions, exclusions and whether separate entities share one amount. Contractual requirements can also exceed the statutory minimum.

Renewal timeline

Six to eight weeks before expiry: update payroll, occupations, locations and claims.
Before quotation: review new activities and contractor arrangements.
Before acceptance: verify entity names, insurer authorisation and certificate wording.
At inception: distribute the accessible certificate and update the compliance register.
After renewal: retain the expired policy and certificate with the new documents.

Inspection readiness

Keep the certificate accessible and ensure responsible staff can retrieve the full policy, insurer contact and evidence of premium payment. Health and safety records should be maintained independently of insurance. An inspector may ask for the certificate even when no claim has occurred.

Near misses and learning

Not every incident becomes a claim, but near misses can reveal control weaknesses. Review them alongside accidents, ill-health reports and employee concerns. Document corrective action and check whether the insurer must be notified under the wording.