IOSH Managing Safely Practice Test

What is the minimum amount required for employees' liability insurance in the UK?

1. £1 million

2. £2 million

3. £5 million

4. £10 million

The correct answer is: £5 million

The minimum amount required for employers' liability insurance in the UK is £5 million. This requirement is put in place to ensure that an employer can meet compensation claims made by employees in the event of work-related injuries or illnesses. This level of coverage is aligned with regulations set forth by the Employers' Liability (Compulsory Insurance) Regulations 1998, which stipulate that it is mandatory for employers to have this insurance in place. This sum reflects the need to adequately cover serious injuries, which can lead to substantial compensation claims. While the minimum is £5 million, it is common for policies to offer higher coverage limits, as many injuries can result in long-term claims that will exceed this amount. Choosing a lower amount, such as £1 million or £2 million, would not provide sufficient coverage for potential claims arising from severe incidents, while £10 million may exceed the basic requirement, possibly leading employers to pay for unnecessary additional premiums unless determined by their specific risk assessments.