Why is employers liability insurance useful for both employers and employees?December 8th, 2017
Most employers are required by law to have employer’s liability insurance but that’s not the only reason it’s a great investment. An employer’s liability insurance policy insures against liability should an employee become ill or injured as a result of their employment. It’s an essential protection for a business and one that has benefits both for employers and employees.
Benefits for employees
#1 Feeling valued
An employer’s liability insurance policy will ensure that, should anything happen to anyone in the business, there is enough resource to correct the problem. This shows a commitment on behalf of an employer to a workforce and a desire to protect those who are employed in the business.
#2 Peace of mind
If an employer has taken out an employer’s liability insurance policy it’s highly likely that they will also have taken every possible precaution to ensure that hazards don’t exist in the workplace. This tends to give employees the peace of mind of knowing that their interests are taken care of.
If something goes wrong then there is a policy in place to help rectify the situation – that’s something that provides great security for employees, particularly in a workplace where there are lots of potential risks.
Benefits for employers
#1 Legal compliance
Not every employer takes out an employer’s liability insurance policy but realistically there are very few that don’t need to have one. Insurance is a legal requirement for any business trading as a limited company, even with only one employee. There are some exceptions to this but not many. For employers who don’t take out cover, the fines can be substantial – up to £2,500 for every day that you are uninsured.
#2 Protecting your business
Cash flow is crucial to every business and this is often the first thing affected if an employee makes a claim against the business and there is no insurance in place. This has the potential to result in serious financial problems, which could even force the business to close. Even a single claim could do a lot of financial damage so it is rarely worth taking the risk, particularly in industries where there are multiple potential hazards in the workplace.
#3 Peace of mind against future claims
Many occupational health issues don’t become obvious until many years after an employee has worked in a specific role, which means that some claims can arise completely out of the blue. Having an employer’s liability insurance policy in place will protect your business against claims that manifest in the years to come, as well as those affecting the business now.
#4 Risk management and duty of care
Productive, engaged employees need to feel valued and this type of insurance is one of a number of ways in which you can demonstrate to employees that you take your duty of care towards them seriously. It also plays an important role in risk management for a business – it’s not enough to evaluate risks in the workplace or on the ground, it’s also important to ensure that those risks can be dealt with if they do arise.
For more information on employer’s liability insurance and why your business needs it, please get in touch with Morgan Richardson today on 01277 630666.