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What is Employer’s Liability Insurance Good For?

 

Employer’s liability insurance is insurance that protects employers in situations where they may be liable to pay costs related to work injuries or illnesses and other compensation for people in their employ that are not covered under workers’ compensation.

What is Employer’s Liability Insurance?

Employer’s liability insurance is also known as employment practices liability insurance, and it includes protection for financial loss due to fatalities resulting from workplace conditions and practices. In some cases, this kind of insurance is compulsory.

Employer’s liability insurance is good for the financial protection of employers in any size business. Whatever the company, and whatever form the employment management structure takes, the employer can be protected against liability claims due to injuries and damages through employer’s liability insurance. A thorough and comprehensive business insurance package will include employer’s liability cover.

Do I need Employer’s Liability Insurance?

If you employ one staff member on a permanent or temporary basis, and if you employ contractors or labourers, the standard practise remains to acquire employer’s liability insurance to protect you as the employer should anything unforeseen occur. There are many situations in which a worker or employee can claim against an employer for liabilities.

The situations in which employer’s liability insurance becomes useful can vary greatly but include elements that aren’t necessarily predictable or controllable. For example, should an employee be injured due to a lightbulb bursting during a power surge, or should a heavy object fall on their foot at work, they can instigate a claim against the employer. Your employer’s liability insurance policy will in such cases provide financial cover to pay for medical bills and reparatory costs.

Can I reduce the risk of Liability Claims as an Employer?

Yes, this is possible. By reducing the chances of injury in the place of employment, the chances of a claim due to injury will, of course, lower. For this reason, in-depth health and safety standards and practices that are rigidly followed in the workplace can make a big difference. Staff should be trained in best practices regarding safety in your particular line of work, and measures should be put in place to keep employees accountable and motivated.

In some cases, the use of protective gear or equipment is required. In other cases, procedures for the way things are used will be more important. Something as simple as the way your storeroom is packed can have an impact. You can prevent boxes or sharp objects falling on people with some careful planning. But, even with careful planning, all employers remain at risk of an unpredictable accident occurring for which they can be held liable.

What Does the Worker’s Compensation Act Cover?

The Compensation for Occupational Injuries and Diseases Act No.  130 of 1993 (COIDA) covers accidents at work, so any wilful acts by the employee themselves or another employee may not be covered. Should COIDA breach a person’s constitutional rights to fair compensation because of their limited payments, additional cover may be necessary, and this is where Employer’s Liability Insurance becomes useful. COIDA also does not protect workers in instances where they refuse or willfully neglect medical treatment, workers outside the country for 12 months or longer, and workers who have an accident while working temporarily in South Africa.

Involve the Experts

Attorneys or legal advisors and risk assessment teams can benefit an employer greatly when it comes to Employer’s Liability Risks. An employer can learn more about what is expected of them and what they can and cannot be held liable for with the assistance of a legal team. Risk assessment teams can help the employer assess areas where actions can be taken to lower risks.

Sources: lsginsurance.co.za; insurance.co.za; momentum.co.za; hippo.co.za; businessdictionary.com;

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