Employers Liability insurance covers claims made against you by employees or subcontractors of your company.
If you are a typical ‘one man band’ company, either employing just yourself or yourself and our spouse, the likelihood of any claims is clearly negligible. However, many contractors do hold the policy because it is commonly required by recruitment agencies and end clients. It also helps to show that you are operating a ‘genuine business’ for IR35 purposes.
It is important to note that if you do have any employees, the policy is a legal requirement.
The legal minimum level of cover for most companies is £5m, but the vast majority of insurers will provide a £10m policy as standard.