Where's your insurance certificate?

A small company has been fined £726 and ordered to pay prosecution costs of £557 because it wasn’t displaying a valid employers’ liability insurance (ELI) certificate. What must you do by law?

Court case. In September 2018 the HSE announced that A E Motors Birmingham Ltd had been fined £726 by Birmingham Magistrates’ Court. During an inspection initiative in conjunction with the local police and council, HSE inspectors had asked to see the company’s employers’ liability insurance (ELI) certificate which wasn’t displayed. When this couldn’t be produced the HSE took enforcement action. The company pleaded guilty to breaching the Employers’ Liability (Compulsory Insurance) Act 1969 . As well as receiving a fine, it was ordered to pay costs of £557.

Legal requirement. This case highlights just how easily a small business can end up on the wrong side of the law. Most employers carrying out business in the UK must have ELI with a minimum cover of £5 million. In practice, most insurers will offer cover of at least £10 million. ELI must be obtained from an authorised insurer, i.e. one who works under the terms of the Financial Services and Markets Act 2000 (the Act). If it’s obtained from a non-authorised insurer, you’ll be breaking the law. You can check whether an insurer is authorised to provide ELI by searching the Financial Services Authority register

Tip. To comply with the requirements of the Act, you must display a copy of your ELI certificate where your employees can easily read it. If you prefer, you may display it electronically, e.g. on your intranet, instead of on a notice board, but all employees must know where and how to find it. Further guidance is available from the HSE.

Summary: As a minimum, you must have £5 million of ELI cover and display your certificate where your employees can easily read it. It can be either in hard or soft copy format, e.g. on your intranet.