Employers Liability Insurance

Employers liability insurance, or employee liability insurance as it is more sometimes known, is one of the few legally required classes of insurance in the United Kingdom. The employee liability insurance policy is designed to protect the policyholder against claims in respect of their legal liability for injury or disease sustained by an employee during the course of their employment. Under the Employers Liability (Compulsory Insurance) Act 1969 all employers are required, by law, by to hold employers liability insurance. There are limited exceptions to this requirement and these include

Non-incorporated businesses employing only close family members e.g. spouse, son, daughter, grandson
Incorporated bodies, limited companies, where the only employee also owns more than 50% of the equity in the business. (from 28 February 2005)
Public service bodies and certain other prescribed organisations.

The current legal requirement for the limit of indemnity, the cover under the policy, is not less than £5 Million. In practice most insurers provide a limit of £10 Million as standard, although this may be increased by the employer if it is not felt to be adequate. Employers Liability Insurance in Practice In general employers liability cover is not available in “isolation” that is to say that insurers avoid providing cover for employers liability on its own. It is more usual for the cover to be arranged in tandem with public liability cover or as part of a package of insurances such as commercial combined insurance, office insurance or shop insurance. Employers Liability Claims It is in the nature of employers liability claims that whilst some claims incidences are immediately apparent to both employer and employee, there is the potential for claims to arise many years after an employee has left the employer or indeed the employer has ceased trading. This is of course a feature of claims relating to industrial disease.

The ability to correctly identify the correct insurer, or insurers, at the time or during the period that the injury took place has been a focus of attention over recent years. In 1999, the Employers’ Liability Code of Practice was adopted by many insurers From Spring 2011 the Employers’ Liability Tracing Office (ELTO) will collect information from member insurers and maintain a database of employers and the details of their employers liability insurance with the intention of creating a single archive for this information for the future. Initially, the information on the new database will include;

All policies taken out or renewed from April 2011
Policies that have been traced previously by the search office
All policies where a new claim is notified

Whilst insurer membership of ELTO is not mandatory the Financial Services Authority has made the publishing of the employee liability data a legal requirement for all insurers engaged in this business in the United Kingdom. Consequently a significant majority of insurers have joined the programme prior to the “go live” date. In future the Employers Reference Number (ERN) also referred to as the PAYE number will have to be collected for all employee liability policies. There are certain classes of employer who will not hold an ERN and these will be exempted accordingly.

Buying Employers Liability Insurance

Employer liability insurance is available from specialist liability insurance brokers and from a range of direct insurance companies operating across the United Kingdom. Increasingly clients are able to obtain quotations and immediate cover from a wide range of web sites, in addition to the traditional outlets of the high street insurance broker. The premium for employee liability cover is directly based on the activities undertaken by the employees concerned and how much of that work is undertaken. The level of data collated over the years by insurers has developed a rating system for most trades and occupations that produces immediate quotations.

Media Liability Insurance – Concerns For Writers, Producers, Bloggers

As an insurance broker I often receive phone calls from individuals and organizations looking for general liability coverage. The variety of these organizations run the gamut, from your basic contractor to the adult model day care. But it is not this gamut that I am concerned about, at least not for this article, it is the individual and/or organizations that calls seeking general liability insurance for a media related company and are unaware that they need a very specific and obscure coverage called media liability insurance or communication liability insurance.

Some of these individuals and organizations include bloggers, web developers, radio show personalities, authors, production companies, publishers and broadcasters of instructional material, television and radio stations, motion picture companies, cable and satellite broadcasters and the advertising industries electronic publishing services as well as any other entities engaged in preparing materials for publication, republication, and electronic publishing services just to name a few.

Many of these individuals and or organizations do not realize that they need media liability coverage and worse off many insurance professionals don’t even know that media liability coverage exists or that the coverage is most likely specifically excluded from their general liability.This coverage is typically part of the general liability found in Coverage B, Personal and Advertising Injury Liability, in a standard CGL (Commercial general Liability) policy. Personal and advertising injury relates to liable, slander, defamation of character, as well as copyright, patent & trademark infringement. More often than not, it is only when there is a claim, and too late that the individual/organizations learn that the most important coverage for their operation, is excluded from their policy, Media Liability. In most instances their search begins after being instructed by a vendor or contractor to obtain liability insurance. Nonetheless, there are some industry personnel that know they need the coverage but have a hard time coming across a professional that knows anything about the coverage or where to secure it.

In either case, most of these individuals or organizations are at their wits end by the time they find us. Most of which have been told that the insurance they are looking for either doesn’t exist or is unavailable from the last dozen or so brokers or agents they have spoken with. There are clear reasons for this frustration and even clearer reasons that their search for media liability insurance leads them to so many dead ends.

For most of us, insurance company familiarity stems from advertisements, including, by and large those for AllState, Geico, Nationwide and Liberty Mutual, none of which offer, at this time, any variety of true media liability insurance. As a result, most people become frustrated and dissuaded. Whereas media liability insurance coverage is a very simple to understand form of insurance, nonetheless, most captive agents do not offer it. For agents and brokers those that deal primarily with home and auto insurance as a staple of their business model, exploring and becoming proficient in such a specific type of product is not germane to their own operations.

By now you are most likely and certainly asking yourself, alright already, what is media coverage? Media Liability Insurance protects you against claims arising to from the display, communication, transmission or purveyance of information in ways that may violate the rights of others. Media Liability Insurance provides very valuable third party coverage against liable, slander, defamation of character, copyright, trademark & patent infringement, personal injury liability, invasion of privacy claims or unfair competition claims that RESULT in financial consequence or personal injury. Examples of these circumstances would include printing a damaging statement about someone, making slanderous remarks about an individual or a company’s product, using someone’s logo or even the unlicensed use of a cartoon character in an ad or publication, distributing illegally obtained photos of someone, or marketing your product by making damaging false claims about your competitors’ products.

According to Citizen Media Project, which is affiliated with Harvard Law School’s Berkman center for Internet & Society, US based lawsuits have surged 70% in 2008 from 2006. The cost to hire an attorney and defend these allegations can range from $5,000 to at least $100,000 in the event the case goes to trial.”Of the 256 lawsuits dating as early as 1994 through April tracked by the New Media Law Resource Center, damages were awarded in 17 cases, totaling $43.9 million”, said Ron Coleman, a trademark lawyer at Goetz Fitzpatrick in New York. (1)

That is an average of almost $2.6M per judgment, before legal costs. It has been stated in various internet publications that 50% of adults are members of social networking sites like Facebook, MySpace and Twitter. Many times posts on these networking sites are written quickly and done impromptu, many times these posts can be taken out of context and because they are stored indefinitely can leave individuals open to claims well into the future. This brings up another point; adults should make sure that they have personal injury coverage on their homeowner’s policy. To add this coverage is minimal and in fact this coverage is needed if you have or plan on getting a personal umbrella liability policy. For an in an individual in a non-media related industry, this coverage provides similar protection, but on a personal level. In a recent case involving an internet blogging youth, the insured’s daughter hated math class as well as the teacher. The daughter made several “disparaging” remarks about her teacher online. The teacher successfully sued the parents and was awarded $750,000.

The problem with our litigious society is that many times a claim or lawsuit may not involve an error or omission. For example, a client may not be happy with service or just doesn’t want to pay a bill, they can bring a lawsuit or claim alleging an error or omission, but their real objective is to avoid paying for services rendered. In this case and all cases when a lawsuit or claim is filed, the defendant still needs to hire counsel and respond to the claim. In this case Media Liability Insurance typically pays for the cost of defending this type of claim, which in may cases is the bulk of the expense of the cost of the suit.