Public liability vs employers’ liability insurance

These hypothetical examples use the same equipment and premises to show the distinction. They do not determine liability or whether a policy will pay.

A customer is injured

A customer trips over equipment at your premises and alleges that your business caused their injury. They are visiting the business. Check public liability cover, including the insured activities and relevant terms.

An employee is injured at work

An employee trips over the equipment at your premises and alleges a work-related injury. They are working for the business. Check employers’ liability cover, including their actual relationship to the business and relevant terms.

EL can also concern work-related illness, with claims arising after employment ends. Keep records of previous EL insurers and policies, and ask your broker or insurer which periods may be relevant.

No, not simply because a member of staff caused the incident. Distinguish the person allegedly responsible from the person who suffered the harm.

Hypothetical example: A customer claims that an employee damaged their belongings while moving equipment. The employee allegedly caused the harm; the customer was affected. Check public liability cover, including the insured activities and restrictions for property being handled or controlled.

If the employee also suffers an injury, that creates a separate allegation to assess. EL is not general cover for employee belongings or every workplace dispute.

Check the actual arrangement before deciding how someone should be treated. A job title, invoice, self-employed label or tax status alone does not settle their position for compulsory insurance or the policy.

People working for the business

Tell the provider about everyone working for your business, including:

• temporary and casual workers;
• apprentices, students and people on work placements;
• volunteers;
• agency workers;
• working directors and family members; and
• subcontractors.

This list is information to disclose, not a declaration that everyone in it is legally an employee or automatically insured. Ask how the actual relationship is treated and whether any terms need changing.

Subcontractors and other business relationships

Explain the work undertaken, who directs it, who supplies equipment and which businesses have entered into the contract. Clarify who is responsible for arranging insurance and what evidence is needed.

Another business’s insurance does not automatically remove your responsibilities or establish that your own business is insured. If the position is uncertain, seek appropriate legal advice alongside the provider’s explanation of cover. Our guide to employees and subcontractors explains these checks.

Your business may face both employee claims and claims from other people. Check each type of cover against your work and obligations. Buying one does not automatically replace the other.

Before comparing cover, consider:

• how your activities could affect customers, visitors or other people and their property;
• who works for the business and under what arrangements; and
• what clients, sites or venues require.

Working alone does not establish that public liability is unnecessary. Employing staff does not establish that every protection you need is included in EL.

Buying both also does not guarantee there are no gaps. Check each section’s activities, insured businesses, people and conditions. Our guide to what business insurance you need helps with the wider cover selection. For professional-service allegations, use the separate public liability versus professional indemnity comparison.

Separate legal duties from contract conditions, and check the rules for the places where your business and workforce operate. Having insurance does not replace workplace safety duties.

Employers’ liability requirements

Great Britain and Northern Ireland have separate rules. The Employers’ Liability (Compulsory Insurance) Act 1969 applies in Great Britain; Northern Ireland has its own framework. Most employers must arrange EL, subject to applicable exemptions and circumstances.

Where compulsory EL is required, the statutory minimum in both jurisdictions is £5 million. This applies to claims arising from any one occurrence, including related costs and expenses. One occurrence may involve more than one employee.

Required cover must be arranged with an authorised insurer.

That minimum is not a public liability requirement or confirmation that the amount is sufficient for every business. Check the offered limit and any additional contractual requirements. Do not assume family involvement, a sole-director arrangement or low working hours creates an exemption.

Public liability and contractual requirements

Public liability is generally voluntary. Check the requirements for your activity, location and contracts, including applicable licensing rules and client or venue conditions.

A contract may request both types of cover and specify limits or evidence. Meeting its headline amount does not prove that every activity or responsibility is insured. Use our guide to legally required business insurance for the requirements and exemptions to investigate.

The covers can be presented in a package. Check whether the quote includes both types of cover and which terms apply to each section.

Simply Business currently describes EL as part of a tailored policy alongside PL. This does not establish that every provider offers both standalone and combined options.

A package can retain separate sections, limits and conditions. One section’s exclusions or excess arrangements should not be assumed to apply identically to the other. Buying together does not guarantee a saving or complete protection.

Compare what each section protects before comparing the price. A cheaper quote for a different type of claim is not a replacement for the cover you need.

When preparing a quote, describe your work and workforce accurately. Business insurance requires a fair presentation of the risk. This generally means clearly disclosing material information your business knows or ought to know. Or, failing that, provide enough information to alert the insurer that further enquiries are needed.

Answering application questions alone may not be enough. Ask the broker or insurer if you are unsure what to disclose.

Use these checks when reviewing the documents together.

Item	What to check
Limits and legal costs	The actual limits and whether relevant legal costs count towards them or are paid in addition, subject to conditions.
Insured business and work	The businesses, activities, workforce and locations described.
Terms	Relevant exclusions, reporting requirements and compulsory EL protections.
Evidence of insurance	Which sections, businesses, dates and limits the certificate or schedule identifies. Read these alongside the full wording and endorsements, which change the terms.
What the price includes	Whether the figure is standalone, an additional cost or a package total, and the full amount payable on the chosen payment basis.

Where compulsory EL applies, also check the certificate-display requirements. If you display it electronically, employees must know where to find it and have reasonable access.

Compulsory EL has specific protections for employee compensation. Do not import ordinary public liability excess advice into it. Any arrangement requiring your business to repay money to the insurer needs specialist explanation of the applicable law, amount and conditions. It is different from reducing the employee’s compensation.

These guides provide the detailed document and budget checks.

Question	Further guidance
How do limits and excesses work?	Business insurance limits and excesses
What does evidence of cover show?	Business insurance certificates
How should I compare public liability prices?	Public liability insurance costs
How should I compare employers’ liability or package prices?	Employers’ liability insurance costs