I'm a sole trader, do I need it?

Generally no. If you work entirely alone, with no employees or labour-only subcontractors under your control, employers' liability is not usually legally required.

Do family members count as employees?

Gov.uk says you may not need employers' liability insurance if you only employ close family members, but the rules have conditions, so it is worth checking the official guidance for your situation.

What about bona fide subcontractors?

Independent subcontractors with their own cover may not need to be on your policy, but those working under your direction usually do. Your broker can help you work out who counts.

Trades

Do I need employers' liability insurance?

If you employ staff, employers' liability insurance is generally a legal requirement in the UK, with at least £5 million of cover. Here is who it applies to.

If you employ anyone, employers' liability insurance is generally a legal requirement, and under UK law you must be covered for at least £5 million. It is one of the few business insurances the law actually demands.

What employers' liability covers

Employers' liability (EL) covers claims from employees who are injured or become ill because of the work they do for you. For a tradesperson that might be an apprentice who falls from a ladder, or a labourer who develops a condition from dust or noise on site. The policy can pay compensation and legal costs.

When the law applies

If you employ staff, you are generally required to hold EL cover with a minimum limit of £5 million. It can apply more widely than people expect, including:

Full-time and part-time employees
Casual, temporary and seasonal workers
Labour-only subcontractors working under your control

You also need to display your EL certificate (or make it easily available to staff, for example electronically). The official rules, including the exemptions, are set out on gov.uk.

Penalties

According to gov.uk, you can be fined £2,500 for every day you are not properly insured, and up to £1,000 if you do not display your certificate.

Sole traders

A genuine sole trader with no staff usually does not need EL. If you ever take on help, even for a short job, it is worth arranging cover before they start rather than after.

Adding EL to a tradesman policy

Many tradespeople add EL to a wider tradesman insurance policy alongside public liability and tools cover. With Kompare, you fill in a short form and a specialist FCA-authorised broker from our panel contacts you to talk through quotes. Read how we work for more.