Professional Indemnity, Public and Employers Liability certs

[chim_knee]

Hello,

I've just been informed by my agency that the role I am about to start requires that I have the above certificates.

I've never needed these before and therefore have no idea of what to go for, who to use, what to watch out for etc.

Does anyone have any experience of them and any advice/pointers they could give me?

If it's relevant - the role is as an analyst/programmer in an investment bank.

Cheers,
Phil.

[Pot Bellied Fool]

I'm assuming you trade through a Ltd Company then as otherwise only the Prof. Indemnity would really be applicable (although I suppose they could make a case for public liability).

PL & EL usually come together as a package and shouldn't cost a fortune given that you're not working with tools or on a factory site etc.

The PI is usually more expensive since this covers you if you make a mistake which then goes on to cost the bank money.

PL/EL & PI are usually calculated as unique quotes with PI in particular often open to negotiation with the underwriters - you could try any trade bodies that might have off the shelf deals set up (Is The PCG still around?) but my recommendation would be to find a good independent broker.

I think there's at least one on PH (Insurancejon?) but failing that, trying going on local recommendaton but steer clear of the Swintons type outfits, go for a small family broker where you can talk to people with real experience of real insurance. (I use www.millins.co.uk )

Cheers.

Edited by Pot Bellied Fool on Wednesday 28th June 11:51

[chim_knee]

Pot Bellied Fool said:

I'm assuming you trade through a Ltd Company then

Thanks for the information - I'll take a look.
Cheers,
Phil.

[Mrs Cuchillo]

Usually required in the contract. Also a pointer towards being free from IR35 as a business will have these insurances. Don't forget you will need to keep them going even after the contract ends to cover any liability in retrospect.

We are currently using Caunce O'Hara www.caunceohara.co.uk/

Have you joined the PCG? www.pcg.org.uk

Useful forums including good/bad experiences with different insurers.

We got caught out a few years ago by one lot who took the money but didn't put the policy in place. Was investigated by Lloyds, but we must have lost best part of £1000, due to lost premiums and having to make alternative arrangements.

[mikeyboy]

I think that your agent is talking 3 kinds of Sh*%te to be honest. If you are an employer then you need Employer Liability insurance, but in your case then surely the bank or agent is the employer?
As for Public Liability insurance it usually applies to drivers etc who may cause thrid party damage. Would you or anyone directly employed by you be likely to be driving as a part of your daily duties? If not then it doesn't matter.
Teh Professional indemnity part though is a little more tricky. You may want to get it even if you are employed by someone else but it would be just a precaution, if you are employed even temporarily, the indemnity insurance of the employer should cover you (except if the bank is the employer when I would go back to my point of covering your self just in case.)
Hope that helps.
It sounds like the agency either don't know what the're talking about or simply don't want to part with the dosh they are responsible for.

Mike

[ewenm]

I use Caunce O'Hara too (on recommendation from a friend). Not had to claim yet so no idea if they are any good in that respect.

[fasterpussycat]

If you are agency staff then you will not need any of these insurances are you are 'employed'. However, you may be trading through a ltd company in which case these insurances are often required. In fact, I believe that EL of £5m is a legal requirement. James.

[bigandclever]

Three banks I have worked at all required PI (two at £1mil, one at £2mil). No-one else has bothered. I've got Legal Expense cover bolted onto my PI. I don't know anyone who's ever had to claim on PI, but to be honest I don't want to be the first bloke that inadvertently brings a live system to it's knees and (my company) gets stuffed financially in penalties. I have PL as well, which covers stuff like running someone over on my bike or smacking them in the head with a golf ball You don't need EL if you're the only person employed by your company.

If you don't want to get PI (and why wouldn't you, you want Gordy thinking you are a proper business, right?) you could get round the certificate by getting cover and then cancelling within a few days. Pimp has done their bit by checking your cert - though of course, if your contract deems certs to be required and you don't satisfy those requirements, there's your risk. It would be a foolish thing to do. But the company would save £700 or so.

[Parrot of Doom]

Not sure why you'd need PL insurance unless you're building computers in a main road on a scaffold up a ladder!

[chim_knee]

Thanks for the replies all.

I'm not the sole employee unfortunately. My wife is a contractor too (different agency, place of work etc) and is therefore an employee of our company.

So - is about £700 the going rate?

[Romanymagic]

mikeyboy said:

I think that your agent is talking 3 kinds of Sh*%te to be honest. If you are an employer then you need Employer Liability insurance, but in your case then surely the bank or agent is the employer?
As for Public Liability insurance it usually applies to drivers etc who may cause thrid party damage. Would you or anyone directly employed by you be likely to be driving as a part of your daily duties? If not then it doesn't matter.
Teh Professional indemnity part though is a little more tricky. You may want to get it even if you are employed by someone else but it would be just a precaution, if you are employed even temporarily, the indemnity insurance of the employer should cover you (except if the bank is the employer when I would go back to my point of covering your self just in case.)
Hope that helps.
It sounds like the agency either don't know what the're talking about or simply don't want to part with the dosh they are responsible for.

Mike

Probably not the agent, but the client. One of our clients insists on our contractors on site having PL and PI and if the contractors cannot prove they have this they are effectively given notice. As the agent we have to tell our contractors that they have to have the PL and PI in place if they want to work at that client site.

Crazy I know but not actually the agencies fault. And yes, we did try to advise the client that the PL was unnecessary and the PI should be up to the individual contractors Ltd Co. but HR there were having none of it.

Hey ho...

[Plotloss]

3rd party public liability cost me peanuts and thats with tools and toolboxes etc

Not looked into Employers being the sole employee.

PI varies and will be the vast majority of it I would have thought.

[Parrot of Doom]

£700 sounds extremely expensive to me for PL insurance. I pay a £20 premium on my union membership for a few million quid's worth, the union membership is £275 a year.

Even before I joined the union I wasn't paying anywhere near that.

Try Stafford Knight, see what they charge.

www.bfinancial.co.uk/Advisors/4823.html

[Size Nine Elm]

You need PL in case you are in the office with your feet sticking out and someone trips over them and breaks their head open. Or you throw an apple core at the bin, it misses and hits someone's return key and commits them to £10billion in transactions.

Costs peanuts anyway... and if you've got PI cover (which is much more expensive) you'll probably get it for nothing.

Company used to have a compound office/property insurance, EL and PL, for a 10-person company, for about £500 a year.

PI can cost well into 4 digits depending on cover.

[bigandclever]

Parrot of Doom said:

£700 sounds extremely expensive to me for PL insurance.

For PL that is expensive. Not expensive for PI though.

My premium is based on 2 things: the amount of cover required (I have £1million); and the income of the company (which is between 200k and 250k). Caunce Ohara put this at £820 on their website, but I got a discount with them. I also got my £75 Legal Expenses Insurance thrown in. PL costs me about £50 - basically it's there to cover when I work from home and clients visit me.

[insurance_jon]

yup we can arrange all of the above, I doubt you would need e/l cover though if youare the sole employee of your ltd co, or the members are family members. The rules change last feb on that, after realising the pointlessness of it.

[JonRB]

mikeyboy said:

I think that your agent is talking 3 kinds of Sh*%te to be honest. If you are an employer then you need Employer Liability insurance, but in your case then surely the bank or agent is the employer?

I think you're "talking 3 kinds of Sh*%te to be honest".

If the original poster is an IT Contractor working through a Limited Company, then they are NOT an employee of the bank or agent. We've been fighting IR35 for 7 years now and it doesn't help when people come out with this kind of rubbish.

Edit: I arrange my company's "big 3" insurance through the PCG. Costs only a few hundred a year and is worth having just for the pointer to being outside of IR35, to be honest. And I always insist that the agency add the requirement for insurance into a contract if it isn't there already.

Edited by JonRB on Thursday 29th June 09:29

[Andy SIBL]

I'll 2nd what John said, no need for you to carry EL. Although a Ltd company is a seperate legal entity as the sole employee you have no legal requirement to carry EL.

[JonRB]

Romanymagic said:

Crazy I know but not actually the agencies fault. And yes, we did try to advise the client that the PL was unnecessary and the PI should be up to the individual contractors Ltd Co. but HR there were having none of it.

It does not harm from an IR35 standpoint for a PSC to carry PL, PI and EL insurance, and PI makes good business sense in case the client decides to sue.

Clients often insist on PL and EL in case you (as an employee of your PSC) trips over a loose carpet whilst on-site at the client's so that they don't have to pay out. Allegedly.