Reply to: Quick Insurance query

[Wanderer]

But in my case, there are 2 directors, my husband and I and both owning 50% share. So, Do i need it or not ? Any help appreciated.

No, there is no legal requirement for a contractor LTD company to have any insurance whatsoever unless you employ people who are not 50% shareholders or you have your own business premises (doesn't include a home office unless clients visit you there).

The reason people get it is that some clients/agencies stubbornly insist on the contractor company having it as a condition of doing business, in which case you need to negotiate with them or take out the insurance policy.

[SueEllen]

I thought EL was bundled in with PL in most cases which also covers you for legal liability for injury or death to third parties and damage to third party property.

I got Public Liability insurance from the Co-op after finding out on one contract I actually needed it. (Strangely followed by more where the agents demanded it but I didn't legally need it.)

They normally bundle EL with it but when I put in my details the Co-Op online system purposely excluded it.

I then phoned the co-op up and they basically told me I was strange I asked for it as legally I don't need it.

The Co-op premium was only about £70 for a year. (Someone on here kept mentioning it as being the cheapest premium, and he was right.)

The PCG do state in their insurance leaflet that you should have EL as this is an IR35 pointer i.e. you can't employ a substitute without it however if you use subcontractors as substitutes who are limited businesses then you can make them have their own policy.

[SueEllen]

Hi,

I have a question. If the limited company has 2 directors (say husband d wife), then is it required to take the Employers Liability insurance?
Accountant says it is not necessary, and the agent is not too sure.

If you employ/have a director anyone in your direct family then you are exempt from having to buy it.

You can google the actual act ( can't be bothered to do it for you) which is called something like Employers Liability Insurance Act or go on the Heath and Safety Executive website, and read the actual exemption yourself.

[northernladuk]

I thought EL was bundled in with PL in most cases which also covers you for legal liability for injury or death to third parties and damage to third party property.

QDOS also bundle this with PI for about £240 which also includes some free contract reviews.

You could argue it isn't necessary but for that cost it seems cheap just not to have to worry about it.

[Bumble79]

Hi,

I have a question. If the limited company has 2 directors (say husband d wife), then is it required to take the Employers Liability insurance?
Accountant says it is not necessary, and the agent is not too sure.

I did read somewhere that Employer's liability is exempt under
'companies employing only their owner where that employee also owns 50% or more of the issued share capital in the company'

But in my case, there are 2 directors, my husband and I and both owning 50% share. So, Do i need it or not ? Any help appreciated.

Thank you.

[Olly]

Some success Agency have agreed to remove the requirements for EL, as long as i confirm i take thsi cover if i employee a subsitute

So asking does work, just give the right info ack at them!

err....which bit of "it's fine as it was" from the post above wasn't clear?

[BA to the Stars]

Gives you a warm feeling that agents know what they are talking about

[diesel]

Some success Agency have agreed to remove the requirements for EL, as long as i confirm i take thsi cover if i employee a subsitute

So asking does work, just give the right info ack at them!

[SueEllen]

The clause doesn't need removing if it's written as it is in the OP:



If it's not applicable, you don't need it and the term has been met.

WHS - however you have to remember the agent has difficulty understanding the act.

I explained this to my current agency and they were fine with me not having it. This was after explaining to them that my insurer hadn't issued me EL with the PL that I needed for a previous assignment as I didn't need it. Most insurers will automatically allow you to buy the two in a combined policy.

Oh and I have amounts stipulated for PI, but never PL even in the contract where I required it. Looking around I think the minimum you can get for PL is £1 million anyway

[TheCyclingProgrammer]

You don't need EL if you own more than 50% of the share capital, although not sure if the agency will bend to remove the clause!

Do I Need Employers Liability Insurance Small Business Self Employed UK

The clause doesn't need removing if it's written as it is in the OP:

employers’ liability insurance (where applicable in accordance with the Employers’ Liability
(Compulsory Insurance) Act 1969)

If it's not applicable, you don't need it and the term has been met.

[Wanderer]

Spoke to agent today who is adamant i need EL!

Then the agent is a plonker.

I would say something like "My LTD satisfies the requirements of the Employers’ Liability (Compulsory Insurance) Act 1969)", ie has none because it's not required.

[diesel]

i work in oil an gas industry as design engineer.
i was very suprised to see these high levels of insurance cover as previosu agents/contracts never stipulated the amount.
Spoke to agent today who is adamant i need EL!

[SueEllen]

I didn't think you needed PL either if you're working off a client site and no-body is visiting your premises. PI is the one that I thought was important. Could well be wrong though.

It depends on the client's site whether you need it or not.

If the client site is serviced or shared offices where the bathroom facilities etc are shared by all companies in the building then you do.

If the client has a self-contained office where the toilets etc aren't shared then any policy they have will tend to cover you.

BTW what business are you in so that you need such high insurance amounts?

[GillsMan]

You don't need EL if you own more than 50% of the share capital, although not sure if the agency will bend to remove the clause!

Do I Need Employers Liability Insurance Small Business Self Employed UK

I didn't think you needed PL either if you're working off a client site and no-body is visiting your premises. PI is the one that I thought was important. Could well be wrong though.

[Clare@InTouch]

You don't need EL if you own more than 50% of the share capital, although not sure if the agency will bend to remove the clause!

Do I Need Employers Liability Insurance Small Business Self Employed UK