How SMEs Can Protect Themselves Against Personal Injury Claims

A loss of cash flow for an SME due to claims against them can significantly hamper operations, grinding some actions to a halt and running the risk of putting you out of business. For instance, leading up to 2019 the cost to businesses in the UK due to injury reached £5.6 billion. But there are ways that small business owners can protect themselves against personal injury claims to ensure the smooth running of their operations.

Employers’ liability insurance

Employers’ liability insurance is a requirement for any business operating in the UK. Not only is it essential but it must also cover your employees for a minimum of £5 million, or else your company can face a fine of up to £2,500 per day. There is an additional fine of £1,000 if you as an employer do not display your EL certificate or present it to an inspector when requested.

However, if you only employ a family member or someone abroad, employers’ liability insurance may not apply to your business. The benefit of employers’ liability insurance is that it covers both current and former employees, both of whom can make claims against the business.

Protecting yourself with a robust policy insures against personal injury claims, whether that’s something an employee picked up recently or something that was caused historically to an ex-employee – such as asbestos-related illnesses, vibration injuries or carpal tunnel syndrome. Your business will be protected as long as your cover was in place at the time of injury, even if you are no longer trading.

Public liability insurance

While good to have, it is not a legal requirement for UK companies to have public liability insurance. This may see you skip getting this insurance cover but it’s worth considering as you may otherwise open yourself up to injury compensation payments, which can be crippling.

To put into context why public liability insurance is worthwhile, this is what it covers in a nutshell – the cost of legal action and the ensuing compensation if a third party is injured on your premises, at their home, office or place of business due to work you have done.

This level of protection is particularly important when your business operations commonly deal with having people on your premises or you carry out work for a third party on their property. As a small business, the cost of legal fees alone can be taxing on your margins, let alone losing a claim and having to payout.

Property insurance

Typically, a property insurance policy will provide some basic liability cover should there be an accident on your premises. As with most insurance covers though, the devil is in the details. Look closely at the policy for your business property insurance and discover what level of protection you are offered.

It’s common for some protection to be offered with this policy but in an instance where negligence is a potential factor, an insurance company may decide to challenge and pursue damages. When deciding on which insurance policies your business may need, a thorough risk assessment is essential. Not only at the beginning or when you move premises but continually throughout the lifecycle of a company as methods, equipment and people change.

Building inspections

Safeguarding against personal injury claims is more than simply buying all of the insurance covers under the sun. For starters, that is an expensive approach and doesn’t necessarily stop someone from getting injured under your watch.

Prevention is better than cure, as they say, and ensuring your building is fit for purpose is an excellent defence against potential personal injury claims. Investing in regular inspections might seem like an expense a small business can do without but they also help to point out any defects or potential dangers your premises has.

Finding these problems and removing them not only makes your workplace safer and avoids potential injury claims but it can also help to create a better working culture while avoiding employee downtime due to injury. When staff feel safe in the workplace they are more likely to want to stay. In addition, known as ‘key-person risk’, SMEs should protect their business from the disruption and negative ramifications of relying on and ultimately losing a key member of staff.  

Building inspections can encompass equipment and working environments or stations to ensure that your staff have the right tools for the job without putting themselves at risk of injury. For instance, in an office, a risk assessment could raise a need for adjustable chairs and a brighter environment to ensure staff avoid back pain and headaches. Ultimately, removing lost time due to injury helps a business remain more productive.

Employee training

One final step for small businesses to protect themselves against personal injury claims is to better train and educate their staff about working safely. Training is an essential component of any job role and safety training should not be overlooked in terms of its importance.

Everyone is responsible for their own safety but in a working environment you are liable, so enforcing safe working procedures is a must to safeguard yourself and your employees. With lessened teams as well as potential personal injury claims, employers with injured workers have plenty of costs to worry about. Creating effective training channels and outlining what your employees’ rights and laws are improves understanding and makes for a happier and safer workplace.

SMEPersonal Injury ClaimsPublic Liability InsuranceProperty InsuranceEmployers’ Liability Insurance