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Employers Liability Insurance

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Employers Liability Insurance

Employers Liability Insurance

Employers Liability Insurance is designed to shield employers from claims made by their employees for damages resulting from personal injuries incurred during employment that ACC (Accident Compensation Corporation) does not cover.

Why is Employers Liability Insurance Important?

Employers liability insurance plays an indispensable role in risk management for businesses. Despite all precautions, workplace injuries can occur, and these incidents can bring forth claims from employees if these injuries are not covered by ACC. In many instances, these claims could amount to significant sums, potentially jeopardizing the business’s financial health. 

Employers liability insurance is necessary component of your business risk management, its affordability makes it a wise investment. In New Zealand, the average cost of employers liability cover typically ranges between NZ$10 – NZ$15 per month. 

It’s crucial to have employers liability coverage if your business:

  • Has employees
  • Utilizes physical labour
  • Involves heavy personal equipment 

What Does Employers Liability Insurance Cover?

Employers liability insurance provides your business with essential protection against claims for injuries or accidents that aren’t covered by ACC. 

Legal costs

One of the primary things Employers Liability Insurance covers is the legal costs associated with defending a claim. This includes attorney fees, court costs, and other associated expenses. In the unfortunate event of a lawsuit, these costs can escalate rapidly and put a strain on your business finances.

Compensation payouts

In cases where your business is found liable for an employee's injury that ACC does not cover, the insurance will cater to the compensation payouts. These can include lost wages, medical costs, or damages for pain and suffering, depending on the nature and severity of the injury.

Rehabilitation costs

Some injuries might require prolonged periods of recovery or rehabilitation. If the court orders your business to cover these costs, Employers Liability Insurance will step in to help with this financial burden.

How much does employers liability insurance cost?

Employers liability premiums are calculated on several different factors including:

  • Limit of cover
  • Type of industry
  • Number of employees 
  • Turnover 

Employers liability insurance in NZ typically costs between $10 to $15 per month. 

Who Needs Employers Liability Insurance?

Any business that employs staff should consider Employers Liability Insurance. It’s especially crucial for businesses in high-risk sectors such as construction, manufacturing, agriculture, or any industry that involves physical labor or the use of potentially dangerous equipment.

No, Employers Liability Insurance is not mandatory in NZ. However, due to the high financial risks associated with employee injury claims, it is highly recommended for businesses to mitigate these risks.

No. The cover does include part time or temporary employees. It does not however cover contractors. 

Top professions that need statutory liability insurance

In New Zealand, Employers liability is a critical safeguard for many professions, protecting them against employee claims for injuries and accidents. 

How do I get proof of employers liability insurance?

You can usually get proof of insurance same day when you purchase insurance through Gerrards.

Acquiring a employers liability insurance certificate from traditional insurance brokers may require a few weeks, a delay that could create problems for people or businesses who need instant insurance proof.

To obtain insurance coverage promptly, contact us. We may require you to provide some fundamental details about your business, such as:

  • The name of your business
  • The nature of your business activities
  • The total number of employees
  • Predicted annual income
  • Years of experience in the industry

What does employers liability insurance not cover?

Employers liability insurance does not cover:

Pre-existing Conditions

Employers liability insurance policies typically exclude injuries caused by pre-existing conditions or illnesses.

Non-work-related Injuries

Injuries that occur outside of the workplace or working hours are not covered.

Wilful Misconduct

If an injury results from an employee’s wilful misconduct or disregard for safety procedures, the insurance will not provide coverage.

Claims Covered by ACC

If ACC already covers the claim, Employers Liability Insurance will not provide additional coverage.

Other common questions about employers liability insurance

Public Liability Insurance protects your business from claims made by third parties for property damage or bodily injury caused by your business activities. Conversely, Employers Liability Insurance covers claims made by employees for injuries incurred during their employment that ACC does not cover.

This depends on the terms and conditions of your specific policy. However, in most cases, you can cancel your policy at any time. It’s always a good idea to discuss this with your insurance broker or provider.

Without insurance, you might be held financially responsible for all the costs associated with the claim. This can include medical expenses, lost wages, rehabilitation costs, and possibly even damages for pain and suffering.

You can often lower your premiums by demonstrating a commitment to safety in your workplace. This can include safety training, implementing risk management procedures, and maintaining a good claims history.

Employers Liability Insurance does not generally cover mental health issues unless they are a direct result of a physical injury or an accident witnessed during the course of employment. 

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