Can I make an injury claim if my employer is uninsured?

In the UK, all employers are legally required to carry Employers' Liability Insurance. This insurance ensures that protection is in place for employees affected by work-related accidents or industrial disease. Most claims are settled by the employer's insurance company.

So what happens if your employer is not insured, or if the insurer is no longer in business?

Employers' liability insurance

By law, employers must take out an Employers’ Liability Insurance (EL) policy.

EL insurance ensures that injured workers receive the full amount of compensation they need to fund their recovery and rehabilitation. It also protects companies and businesses from the financial consequences of a worker’s injury claim.

By law, employers must have minimum of £5million cover (source. gov.uk).

What if my employer is uninsured?

You can still make a compensation claim if your employer does not have valid Employers’ Liability Insurance. Typically this will mean claiming compensation directly from your employer.

If your employer is no longer in business, it may still be possible to claim compensation - depending on the structure of the business.

To explore your options, please call us on 0800 376 1001 to discuss your options.

How can I find my former employer's insurer?

The Employers' Liability Tracing Office (ELTO), is an independent not-for-profit body set up by the insurance industry. It collates information on Employers' Liability (EL) insurance policies in a central Employers' Liability Database (ELD), so that injury claimants can find their employer's insurer.

Claimants and their solicitors can access this database through an online search facility using the employer's ERN.

How does the Employers' Liability Database work?

Any organisation (including businesses, churches, charities and community groups) that has employees or uses subcontractors is issued with an Employers Reference Number (ERN) by HMRC. ERNs are unique to the individual employer.

The ERN is the reference numbers used for the organisation's employee income tax and national insurance contributions. ERNs are also referred to as 'Employee PAYE Reference'.

Every organisation must provide its ERN to its EL insurer, who then submits the number to the ELTO. Failure to inform the insurer of the ERN may invalidate the policy.

This information is securely stored within ELTO and used only for matching an employee's search to the insurance policy that covers the period of injury or illness.

How can I find my ex-employer's ERN?

All mandatory documents such as P45s, P60s, P11Ds, and most payslips, will include the ERN.

The format of the ERN normally starts with three numbers (representing the tax office whose catchment area the employer falls into) followed by a forward slash and then combination of letters and numbers, for example: 083/WY12345.

Some organisations have more than one ERN, usually relating to subsidiary companies.

How do I contact ELTO?

Individuals who want to trace EL insurer details can do so by visiting http://www.elto.org.uk

Although claimants are able to trace the insurer should they ever need to make a claim, the results from the search of the ELD are not proof of insurance, or proof of liability.

Can I claim for an injury if my employer's insurer went bust?

Yes. If your employer's insurer has ceased trading, you may still be able to make a work-related injury claim.

In extreme cases, where an employer and their insurer have both ceased trading, and no other responsible party can be traced, compensation may still be available through the Financial Services Compensation Scheme (FSCS).

What is the Financial Services Compensation Scheme (FSCS)?

The Financial Services Compensation Scheme (FSCS) is a government-backed scheme that provides businesses with statutory protection when their insurance company ceases trading.

The FSCS is essentially a reserve fund, paid into by financial institutions. The fund is designed to compensate anyone who is affected by the collapse of a financial services organisation - including insurance companies.

The FSCS has two main objectives:

• To maintain continuity of insurance, which it does by trying to find another insurance company to take over the policy
• To compensate policyholders whenever an insolvent insurance company is unable to pay claims.

The level of compensation depends on whether the insurance policy was taken out voluntarily or compulsorily. Because employers are legally required to hold Employer's Liability Insurance, the FSCS must pay out 100% of any valid claim.

A fund of last resort

The FSCS is a fund of last resort. This means that compensation negotiations must first be directed to the insurance company's insolvency practitioners. The FSCS will only pay out if the insurance company does not have sufficient assets to cover the cost of the claim.

How does this work in practice?

Initially, a work accident claim will proceed as normal, regardless of the status of employer's insurance status.

Your personal injury solicitor will gather medical and other evidence, to establish whether your injuries resulted from the accident and that your employer is legally responsible.

If it is subsequently discovered that there is no insurance in place, an application will be made to the FSCS. The FSCS administrators will then appoint an agent to review the claim. In the majority of cases, liability is admitted and the claim will not have to go to court.

Your personal injury solicitor will negotiate the best possible compensation settlement with the agent and the FSCS will pay the agreed settlement in full.

Read more:

Can I claim compensation if my employer has gone bust?

Work accidents Road accidents Public places Medical negligence Other accidents

Author:
Gaynor Haliday, Legal researcher

About the author

Gaynor Haliday is an experienced legal researcher and published author. She has had numerous articles published in the press and is a legal industry commentator.