If you employ full-time, part-time or casual staff then by law you need Employers Liability Insurance (ELI) to protect you against claims from your employees for accidents or sickness caused as a result of working for you. The legal minimum cover is £5 million, although the more usual limit of indemnity offered by insurers is now £10 million. ELI premiums are rated on your business type, payroll and the number of employees you have. Other factors include the number of claims your company has made and the standards of health and safety management within your organisation. ELI premiums continue to rise as the number of claims and costs for insurer’s increases. Claims rose by 76.4% in 2001 alone. So what can you do to minimise the cost of your ELI premiums? Reviewing and improving health and safety standards within your business is always a good place to start. Good health and safety procedures protect the company and its employees resulting in fewer claims and a lower level of risk for insurers, hence potential reductions in the cost of insurance premiums. Implementing procedures to prevent accidents and ill health should be a priority in every business. The benefits far outweigh the costs and you will have peace of mind knowing you have done everything possible to protect you and your company against prosecutions, fines and compensation claims. Below is an example of the costs that can be incurred if things are not done properly. An employee falls from a step ladder and suffers a compound fracture of his right ankle. He is off work for a year recovering following major surgery and has to be replaced for a year by the employer. There are no records of risk assessments, safe working procedures or training. The company are found fully liable and the insurers pay out £125,000 in compensation. Total uninsured costs for this accident are approximately £110,000 and include: - wages for the injured employee and his replacement
- investigation costs
- fines
- court costs
- insurance premium increase
Company works on 5% net profit and must make £2.2M to cover the cost of this one accident. So what should you do to prevent incidents and defend claims? If you do not have access to expertise in-house you should seek advice from a health and safety consultant. It is a legal requirement that you appoint someone to provide you with competent advice on health and safety matters. Your safety adviser will help you put in a health and safety management system that should include: - Identifying the hazards in your workplace,
- Assessing the risks from these hazards
- Introducing safe working procedures for the employees to follow
- Training your employees in the risks and necessary controls
- Monitoring the work to ensure it is being done safely and the
- workplace to ensure it is always safe to work in
Taking these steps will reduce incidents, but if something happens you need to be able to prove that you have done everything reasonably practicable to prevent it. You should record: - The risk assessments that you have carried out for the working environment and specific high risk activities
- Safe working procedures for activities deemed to be high risk
- Training that is given to follow safe working procedures
- Workplace Inspections to ensure that safe working procedures are being followed
- Incidents and investigations to ensure that similar incidents do not happen again
There is never any guarantee that taking these steps will help defend against claims but if you do not do anything, there is a much greater likelihood that a claim will be successful. Insurers know this and if they can see that you are proactively managing your risks, they are likely to offer you a more attractive premium.
For more details please call Mark Rastrick on 01767 692196 or simply email us at info@grmhs.co.uk and we will contact you. | 
