Employers’ liability insurance essentials
Produced in partnership with Scott Nightingale of Kennedys
Employers’ liability insurance essentials

The following Insurance & Reinsurance guidance note Produced in partnership with Scott Nightingale of Kennedys provides comprehensive and up to date legal information covering:

  • Employers’ liability insurance essentials
  • Overview of employers’ liability insurance
  • The policy
  • Making a claim
  • The Third Parties (Rights Against Insurers) Act 2010
  • Risk management

Overview of employers’ liability insurance

Legal principle

It has been a long established principle of law that an employee who has suffered an injury or contracted a disease in the workplace as a result of an employer’s negligence (and, up until the enactment of the Enterprise and Regulatory Reform Act 2013, a breach of statutory duty), is entitled to compensation for such injury and any associated losses.

Historically however, it has not always been the case that an employer had to insure against such eventuality. Prudent employers would of course; however some did not, leaving the rather unsatisfactory question as to whether they provided ‘value for the money’ when faced with a claim for compensation.

Consequently, and with a desire to enhance safety in the workplace, the Employers’ Liability (Compulsory Insurance) Act 1969 (EL(CI)A 1969) was born. Indeed since 1972 when EL(CI)A 1969 came into force, it has been compulsory for employers to have employers’ liability insurance.

Statutory requirements

By way of summary:

  1. every employer conducting business in Great Britain must insure and maintain insurance (with an authorised insurer) against liability for bodily injury or disease sustained by its employees, and arising out of and in the course of their employment in Great Britain ‘so the requirement does not extend to injury or disease suffered or contracted outside Great Britain’

  2. the current