Liability Insurance

What Does Public/Products Liability Insurance Cover?
Public and Products Liability insurance policies provide indemnity in respect of legal liabilities to third parties for accidental death, bodily injury or disease or damage to third party property, arising out of an insured’s business activities. The products liability section covers liability to third parties for accidental death, bodily injury or disease or damage to third party property arising from goods sold, supplied, manufactured or processed. Ordinarily, Public and Products Liability insurance policies are written on a ‘claims occurring basis’. This means that they only respond to claims occurring during a policy period.

Public and Products liability insurance provides a safeguard, allowing you to continue normal operations in the event of a claim being made. The policies provide cover for the costs of defending and settling.

What Does Employers’ Liability Insurance Cover?
Employers’ Liability insurance policies provide indemnity in respect of legal liabilities to employees for death, bodily injury or disease arising out of or in the course of their employment. All organisations that employ more than one person are required to carry Employers’ Liability cover with a minimum £5 million limit of indemnity. However, most insurers provide £10 million as standard. Employers can be fined up to £2,500 for every day that they are not properly insured. Additionally, even employers that do have adequate cover may be fined £1,000 if they do not display their employers’ liability certificate, or refuse to present it to inspectors upon request.

The issue of subcontractors often causes confusion. There are however distinct differences between Bona Fide and Labour Only subcontractors i.e.

Bona Fide subcontractors undertake work where they ordinarily supply their own labour, materials and use their own tools. Bona fide subcontractors are responsible for their own risk assessments and for supervising the health and safety aspects of their work.

Labour Only subcontractors work under the direction and control of the employing company. Anyone utilising the services of a Labour Only subcontractor is responsible for risk assessing and ensuring safe working practices are adhered to. Employers have a statutory duty under Health & Safety law to protect labour only subcontractors in the same manner as PAYE employees.

N.B. Employers’ Liability Insurance isn’t just a legal requirement for paid employees. If you are unsure as to your legal requirements see the HSE’s brief guide for employers or contact us to discuss further.