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Employer Liability Insurance


You have a dream to start you own business. Just imagine a situation where your employee is injured. How will you manage such a situation? In such time of crisis the Employer Liability Insurance helps.

Employers Liability compulsory Insurance (ELCI) is mandatory in U.K. It helps the employer to meet the cost of legal fees and compensation in the even of injury of the employee.

ELCI is compulsory in UK and it covers employees companies situated in England, Scotland, Wales, and Northern Ireland. Companies should be insured for minimum 5 million. Insurance companies generally provide limited up to 10 million.

Companies which are not limited, have only one employee or employs only close family members need not take ELCI. Limited companies with just one employee who is the shareholder of 50% of the share capital are exempted from ELCI.

Health and Safety Executive is the enforcement authority of Employers Liability compulsory Insurance. There is a fine of 2,500 for non compliance of insurance measures.

For compliance of ELCI an employer is defined as one whose Income tax, national insurance are deducted from the salary, the company controls where, how and when they work. The employee cannot employ substitute on his own for his work.

Insurance Companies which provide ELCI should be members of the Association of British Insurers (ABI).

The Companies which provide ELCI are Hiscox, Lloyds TSB, AXA and Brighter Business.

Hiscox offers Employer Liability Insurance cover of up to 10 million. This will cover compensation and damages cost. It also includes any legal fees charged for claims. Employer Liability Insurance is available with Public Liability Insurance.

Lloyds TSB offers Employer Liability Insurance cover very similar to offered by other insurance companies.

Axa offers the insurance as public liability and Employer Liability Insurance. They have cover for both permanent and temporary employees, risks on tools and phones, for contract works and personal accident cover.

Brighter business offers cover of 10m for office, home worker and retail policies.

The company on taking ELCI will receive a certificate of ELCI. This should be displayed in a place where the employees can read. The copies should be retained for 40 years. Companies which do not maintain the certificate can be fined up to 1,000. The certificate should be produced to Health and Safety Inspectors if they ask for it.

With the government making it mandatory to have ELCI it becomes a part of business itself. Strict enforcement of rules helps in protecting the benefits of the employees.

The benefits of having this insurance helps the employer pay the employee in the event of claims due to any work related illness or injuries. Every company has its own difference in policy and it makes it easy for businesses to select the ones which suit them best.

So relieve yourself from headaches of employee claims by taking an Employer Liability Insurance and be satisfied that you have followed the law.