Specialist insurances and IR35 advice
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Our fully comprehensive policy offers the
*Products Liability is also included as standard in all policies
Covers work undertaken in: Great Britain, Northern Ireland, the Isle of Man, the Island of Jersey, the Island of Alderney and offshore installations in territorial waters around Great Britain and its Continental Shelf.
Includes a FREE IR35 review
|We'll give you an overall inside/outside IR35 opinion regarding your contract as a whole, including a comprehensive list of essential changes (if any need to be made). We'll also recommend a list of insurances tailored to you and offer guidance on any applicable legislation.
You choose the cover limits you need
|By offering multiple products within a single product, we allow you to chose the exact cover limits you need, so you can match the insurance requirements stated in your contract, all whilst minimising your admin time in arranging what are traditionally separate insurances.
Tailored specifically for Energy Sector Contractors
|Through our vast links in the UK insurance industry we have sourced one of, if not the leading specialist insurer in this area to underwrite the risks - AXIS. AXIS have a deep understanding of the energy sector and the risks faced - meaning their coverage is tailored to the exact requirements of those working in the industry.
Public liability insurance provides protection against the end client, the general public and people the business visits who make a claim that alleges personal injury or property damage. It is therefore integral for those contractors who interact regularly with customers. The end client of every contractor is their customer given they are providing services to them, meaning they at the very real risk of a claim being made against them.
Public liability insurance is often mistakenly thought of as only being required if your business operates from an office, but those without an office are still at a high risk of having a claim made against them, often through something as minor as someone tripping over their laptop bag or damaging property of the end client. No matter how careful you are, accidents will always happen, and contractors working in trades which involve manual work are virtually always requested to hold public liability insurance at all times as a result.
Public liability, unlike employers liability, is not a legal requirement. However, virtually all contractors take it out either because end clients and agencies insist that a contractor hold public liability insurance before they are allowed to commence on a contract, or they prefer to obtain the protection and peace of mind having the insurance in place come what may.
Public liability covers your business for any claims made against you by the end client or members of the general public, typically for personal injury, serious illness or accidental death, or damage to their property. The policy reacts by covering the legal costs in defending the claim as well as paying the damages for which you are found liable, the costs of repairing the damaged property, or even NHS costs i.e. the ambulance call-out, if they decide to make a claim against you.
From an IR35 perspective a business strengthens its IR35 status by holding public liability, with some contractors feeling it is prudent to have this insurance in place even if the end client or agency do not request it.
Accidents happen on a daily basis, we just think that we are careful and therefore it won’t, or is unlikely to happen to us. The truth is that it can happen to any business, and when it does it becomes the very real problem of vast legal fees and compensation for the business owner to sort out, meaning a lot of stress and financial worry. Slips and trips are in the news every day, and are one of the most common accidents that occur, it could even be a result of tripping over your laptop bag or a tool. public liability insurance takes away this hassle and provides peace of mind to allow you to continue doing what you do best, obtaining and working on contacts.
There is no legal or set requirement on the minimum level of indemnity that is required, but most providers offer, and end clients and agencies expect, a limit of £1,000,000. Limits of £2,000,000, £5,000,000 and even £10,000,000 are offered and commonplace for contractors.
Public liability insurance won’t cover you for accidents that happen to you personally or your employees, or you, your business and your employees’ property. Employers liability and general business insurances should be taken out to ensure cover is in place for these.
Employers liability insurance provides protection against the contracted employees of a company i.e. full time, part-time, contract, temporary, casual and seasonal staff, making claims that allege personal injury or illness through work, making it integral for those contractors who have more than just themselves working for the company.
Employers liability is a requirement for any company that has any employees be they permanent, part-time or temporary workers as you have a responsibility for their health and safety as their employer. If you a Limited Company and you are the single employee and own at least 50% of the issued share capital of the company then you are exempt from having to hold employers liability, meaning that if you are the stereotypical one-man-band business that employees only you, this insurance is not required.
It is not uncommon for end clients and agencies to insist that a contractor hold employers liability insurance, as an extension to a public liability insurance policy, before they are allowed to commence on a contract.
Employers liability covers your business for any claims made against you by employees or sub-contractors, typically for personal injury, serious illness or accidental death sustained as a result of their employment with you, reacting to cover the legal costs in defending the claim as well as paying the damages for which you are found liable*.
*Note – if your insurer believes that you have failed to meet the health and safety legal responsibilities for your employees that leads to a claim being made, they may sue you to recover the cost of the compensation.
From an IR35 perspective a business strengthens its IR35 status by holding employers liability, with some contractors feeling it is prudent to have this insurance in place as they may engage their right to substitution and therefore need cover as a result.
In England, Scotland and Wales, The Employers’ Liability (Compulsory Insurance) Act 1969 makes it a legislative requirement for a business that employees anyone to have a minimum level of £5,000,000 cover in place.
The 2004 amendment to this act provided the exemption for what is in effect one-man band Limited Company’s not to have to hold employers liability.
You only need employers liability insurance if your employees are normally based in England, Scotland or Wales, including offshore installations and association structures. If all your employees work abroad you do not therefore need the insurance under UK law, however, you will need to check the relevant legislation for the country that they are based to ensure they are protected as required. If you have employees who are normally based abroad but are in England, Scotland or Wales for more than 14 continuous days (or more than 7 continuous days if on an offshore installation) you will need Employers Liability for them.
A business is required by law to display a copy of their employers liability certificate so that employees can easily read it, which since the 1st October 2008 can be electronically as long as employees are informed how and where to find the certificate. Also since the 1st October 2008 there is no longer a legal requirement for employers to keep copies of out of date certificates, although it is prudent to continue to do so given that some illnesses occur decades after exposure and some employees will make a claim against the employer at the time they were exposed to the cause of the illness.
If you are required by law to hold employers liability and do not, if caught by the Health & Safety Executive (HSE) you can be fined up to £2,500 for each day you are without the required insurance, whereas not displaying or providing the HSE inspector with, or clear and easy access to, your employers liability certificate can result in fines of up to £1,000.
Further information, including the text of the Act and the regulations can be found online at http://www.legislation.gov.uk./
For those based in Northern Ireland, The Health and Safety Executive for Northern Ireland (HSENI) enforces the law on employers liability insurance. HSENI inspectors can check that you have Employer’s Liability insurance in place for at least £5,000,000 - as per the The Employer’s Liability (Defective Equipment and Compulsory Insurance) (Northern Ireland) Order 1972. However, it is best practice to carefully consider the risks and liabilities you face and if insurance cover of more than £5,000,000 (we offer £10,000,000 as standard) would be appropriate.
Further information for those based in Northern Ireland can be found online by clicking here.
Where it is required, the legal obligation is to have a minimum limit of indemnity of £5,000,000, but most providers offer £10,000,000 as standard. Larsen Howie provide a mandatory limit of £10,000,000 for our energy sector combined product, reducing to £5,000,000 when offshore - which is the common way the product operates for this sector.
Professional indemnity (PI) insurance is the main insurance required by a wide range of roles undertaken by contractors, freelancers and consultants, and is designed to provide cover against claims being against your company in respect of errors and omissions in providing its services. It is extremely rare for a contractor to be able to commence a contract with an end client without being able to prove that they have PI in place, often with a limit of indemnity of £1m. Some contractors are often under the impression that the PI held by the agency that they have sourced the contract through covers them - when in fact it doesn’t, leaving them open to claims and enormously exposed. Therefore, PI is a must for contractors else they risk the opportunity of being able to land that dream contract and ensuring their business is protected.
Anyone who provides advice or similar is now likely to be required to contractually have PI in place, as incorrect advice or omission can be a very costly error with large ramifications, often financial, leading to claims being made by the end client or a third party. Whilst not a compulsory insurance, most contracts now include the requirement for PI to be held, and as a business can you afford not to hold PI and risk the reputation and livelihood of your company if you get sued, which itself can often just be an allegation.
PI assists your business by protecting it from the financial costs of both legal representation and liabilities associated with negligence such as errors and omissions in the provision of your services, which can often run in to hundreds of thousands of pounds for each, and a legal case can be brought on the allegation of such and not a definitive case of their being an error or omission. By holding PI, you are also providing the end client with the reassurance that you covered in the unlikely event of the worst happening, increasing the possibility of you landing the contract as a result.
As a business, taking out PI enhances your IR35 position in that it acts as a clear indicator that you are a genuine business as you are open to the possibility of being sued and having to rectify an error or omission at your own cost, whereas an employee would find their employer covering the costs for such an incident. HMRC consider a number of factors with a status enquiry, one of which is being in business on your own account – holding PI assists in demonstrating that you are.
Typically, a £1m (£1,000,000) limit of indemnity is required, with other common limits being £2m and £5m. Limits do range from £50,000 up to £5,000,000, but ultimately it is up to the contractual requirement placed upon your business and the maximum financial loss your client could suffer due to a mistake you make. If the level of cover taken out is not sufficient for your requirements then you will be liable for the remaining amount, which can be significant. More often than not the agency will specify the limit of indemnity required, and with premiums starting at £144.44 (inclusive of Insurance Premium Tax) the cost pales into insignificance given the protection provided.
This is a common mistake made by many contractors. By cancelling the insurance when the contract ends, say maybe in the knowledge that you are taking a well-earned months holiday before taking up the next contract, you risk putting your company in the position of being uninsured at the point a claim is made. A PI insurance policy is what is known as a ‘claims made’ policy, meaning that it pays out for a claim made during the policy period, meaning you need to have the insurance in place when you receive notification of the claim being made against you - cancelling the policy early puts you at risk of being uninsured when a claim is made.
If you are working in the very similar roles the you should be ok with the one policy, but you will need to check the policy documents and with your broker to ensure this is the case, different roles can result in different polices being issues and a different price being charged. Our policies do provide for this providing you are doing the same job role, but always check with us to ensure you are definitely covered.
This is the same as the above question, if you are working in the very similar roles the you should be ok, but you will need to check the policy documents and with your broker to ensure this is the case, different roles can result in different polices being issues and a different price being charged, so always check with your broker. Again, our policies do provide for this providing you are doing the same job role, but always check with us to ensure you are definitely covered.
This depends on the policy taken out, some providers of PI insurance include it as standard, others do not. You need to check with your broker that this is the case and insure yourself accordingly. We provide this cover as standard with all our PI policies.
Unfortunately not. Most PI insurances provide cover for on a worldwide basis but excluding North America, with North America including the USA, Canada and Mexico. If you take up a contract with an end client operating in North America, then you will need to ensure you have a PI insurance policy that specifically extends to that region or take out a separate policy specific to that region. Our policies do not cover Canada and North America.
Examples of what PI insurance can cover includes:
- As designer makes an oversight in the planning which results in unexpected downtime on the main system, taking it wholly offline and with a large financial cost to the end client.
- A management consultants recommendations on costs savings and efficiencies on a project actually increase the costs incurred by the end client.
If you do receive the dreaded letter or call from the end client or a solicitor alleging professional negligence against your company then don’t panic. Within the documentation you will have been issued with are a policy wording, policy summary and policy schedule. Within these documents will be clearly highlighted sections on how to make a claim, including contact details and the next steps. Remember, the sooner you let your insurer know of a claim the better, if in doubt contact them and they can advise you what to do. Visit our Claims page to ascertain the contact details of the claims handler.
There are numerous best practices that can assist you in risk managing down and minimising the chances of a claim occurring, the best being; make sure you have an active policy in place, don’t leave yourself uninsured! Read and understand your contract in full, ensuring you retain copies. Ensure before taking up a contract you are capable of delivering the required end result. Get sign off on the completion of each milestone on the project.