Reply to: Requirement for PI and EL insurance

[SueEllen]

Check the excesses and the clauses on things like equipment cover.
I know one of the insurers insures your business equipment and any related business goods in transit, which means you don't have to worry about someone crashing into you.

[malvolio]

Is it worth pointing out that the main reason for PI is to allow you to defend the case, not insure you against the resultant damages?

Also if the level of risk is the same, and they are laid off by the same underwriters at Lloyds (which they almost certinaly are), why can one be signifcantly cheaper than another? Is there something one is offering that the other isn't, be it too much or too little...?

[Tomo1971]

TBH, after reading a couple of the earlier posts I had already decided to get the extra two insurances....

Thinking it may help me stand out somewhat when the other two or three chaps taken on with me refuse.....

Ill have to do some calling round on Monday... as my existing PL, which has recently renewed is with Simply Business who at the time I found a good price. They were also willing to change a particular clause relating to the type of work I do, after an explanation.

But, SB want another £524 for the year for the remaining two insurances, making £800 for the year. (remember I have a particular clause in there and business equipment cover)

QDOS however, want less at about £400 but thats for all three but wont sell EL without PL, so cant get just the two I need from them, grrrrrrr.

Busy day on the phone coming up I guess.

Thanks chaps.

[Tomo1971]

Couple of things to bear in mind though...

You are a business so not unreasonable to think you will leverage an opportunities at your client to get other people in so will need the extra insurance. If you are so adamant it is only you and will only be ever that isn't going to help you quest against IR35. To be a business a good start is to think like one.

You have a substitution clause in your contract. If the client/agent is going to allow you to send a sub in it isn't unreasonable of them to make sure you have the proper insurances for that sub should the need arise at short notice.

There will be 100+ contractors lining up behind you who either have it or will be willing to get it. If the cost of getting the edge on the competition to win some good business is the few hundred quid then I think that is a good deal.

The first part of that does make sense to me and sounds reasonable. I just wish the client would say 'this is why we want you to have it' rather than 'its required' with no explanation.

Luckily, im 1 of less than 100 people in the UK with the required accreditation to do the job the end client insists on. The companies doing the work are reluctant to send more people to do the course as it costs several thousand each.

I get the jist of your point though..... I dont mind getting it.... just hate the no explanation thing.... im a rebel! lol

Thanks

[GB9]

Good point. Your Ltd Co having PL allows it to buy off the threat to yourself (if that's OK with the insurance co).

Assuming that the claimant has a valid claim and not a personal vendetta, then I would expect a payout from the insurance company to suffice. I believe they would only come after you personally if your company didn't have the insurance. Not sure how this would pan out for a PI claim, although I do remember a case of someone losing £10ks as they weren't insured.

[Ignis Fatuus]

C) They do both because your company doesn't pay out.

Having PL for a) negates the need for b)

Good point. Your Ltd Co having PL allows it to buy off the threat to yourself (if that's OK with the insurance co).

[GB9]

[A] They sue your Ltd Co for damages. It goes bust. Its liability is limited. It doesn't need PL.
[B] They sue you personally for damages. It doesn't matter whether your Ltd Co has PL, it wouldn't cover you personally.

No?

C) They do both because your company doesn't pay out.

Having PL for a) negates the need for b)

[Ignis Fatuus]

Public liability - you put a bag down in the middle of a passage, a client employee trips over it, breaks a leg, takes 6 months off recovering. They sue you for damages, the client sues you for damages. You either lose your house or you have PL that pays out.

[A] They sue your Ltd Co for damages. It goes bust. Its liability is limited. It doesn't need PL.
[B] They sue you personally for damages. It doesn't matter whether your Ltd Co has PL, it wouldn't cover you personally.

No?

[Gemma at Qdos]

I love you. Marry me (unless you are actually a bloke called Geoffrey).

Trevor actually. But ssh

[BolshieBastard]

Yeah, I see that QDOS do the same level of cover than I get now, plus the PI (and more) for less than Im paying now. Thats an option.

My main gripe is that the client dont even know what the insurances cover and are just stating the same line over and over 'its mandatory' with no logical explanation why we need it.

Yes, I will pay it if i need to but why pay for something that I will never need, especially in the instance of the Employers Liability.

One of the managers on the HR side spoke to one of the other contractors who also recently started and he didnt even know what they were for and cant understand why they are been requested. At the moment we think its a legacy requirement from when they passed work to small companies that had a few employees.

We will see what transpires.

Well I just wonder what the other contractor would have said about IR35 and contract reviews etc.

Look, you asked for info \ advice and people have given it. You either accept it or dig your heels in with the agent and risk losing the role and having to pay a wedge out of your own pocket if the unexpected happens.

Its your call.

[GB9]

Well thanks for the love on here guys!

I love you. Marry me (unless you are actually a bloke called Geoffrey).

[smatty]

I've had agencies demand I had £1mil of public liability for roles that involved sitting at a desk producing Visio diagrams. I guess incase I print one out, it falls off the printer, the MD happens to be walking past with his Faberge Egg in his top pocket, slips over and crushes it.

Seems a bit excessive but providers like QDOS are pretty reasonable for this level of cover so easier to just get it. As mentioned above it seems to be the standard these days.

[Gemma at Qdos]

Well thanks for the love on here guys!

But in reference to your question on why clients/agencies say you should have it, besides what they are actually covering you for;

They don't just protect your client, they also protect you.
Although EL is the only legally required insurance if you have more than one person drawing a salary from your company, if it is specified in your contract it is a contractual requirement.
The same goes for PI, it may not be legally required but if it is in your contract, it is a contractual requirement.
Sure you can try and get it removed, but if they won't budge, you're going to have to either get the insurance or go elsewhere.

Clients and agencies are increasingly requesting these insurances from ALL contractors regardless of their personal situation, especially agencies with standard contracts, so finding a client/agency who doesn't request these insurances is getting slimmer and slimmer and you're going to find yourself with slim pickings if you start turning down contracts because of it.

Nobody likes insurance but unfortunately, that's the world we live in. Hope this helps!

[kaiser78]

Were you born a dick or did you come on here to practice been one?

NLUK has a point - for the sake of the QDOS cost get on a do it. If it is a meaty contract which I am guessing it is then this amount won't even touch the sides, and even goes down as a company expense.

You are probably spending more equivalent time on this forum arguing the merits of not taking it out than the cost of the cover itself. However ultimately it is up to you if you want to take it or not, this forum is simply a way of providing opinions / recommendations that are always non-binding.

[GB9]

Can anyone advise please?

Can anyone offer advice or explanations I can use to get my client see sense?

Cheers

Public liability - you put a bag down in the middle of a passage, a client employee trips over it, breaks a leg, takes 6 months off recovering. They sue you for damages, the client sues you for damages. You either lose your house or you have PL that pays out.

Professional indemnity - You plug a cable into the wrong socket. It goes bang and takes out £200k of equipment with it. Can you pay the bill as its your incompetence that has caused the damage? PI will cover it.

My policy for the above costs around £250 for £2m cover. Its something a business would be expected to have.