New regulations raise employer liability premiums

Small business owners and managers across the UK could be faced with overwhelming rises in employer liability insurance premiums due to new health and safety regulations.

Recent changes to the Health and Social Care Act give the NHS a new power to claim treatment costs from firms that have been proved negligent in instances of employee accidents in the workplace, a move which has left many small businesses concerned about their future.

Research from Bibby Financial Services finds that nearly half, 46%, of UK business owners and managers believe they cannot afford an increase in liability premiums, and over two-thirds of respondents stated that further hikes will force them to close their doors.

“The good news for employers is that insurers are willing to work with the business community to minimise additional costs, by reflecting responsible health and safety practices in their rates,” said Andrew Dixon, spokesman for Bibby.

“Businesses that wish to reduce their liability cover costs should heed the advice of the insurance industry and ensure they have cohesive health and safety policies in place.”

Dixon recommends, first, that all employers register with their appropriate body, particularly manufacturers. Owners and managers of manufacturing firms must register with the Health and Safety Executive, whereas employers in most other sectors should register with their local council.

Employers should then carry out risk assessments of their workplace, Dixon said, to ensure correct preventative measures are in place, and they should carry out an annual review.

Employers must also ensure they provide suitable first aid facilities, provide health and safety training to employees and put procedures and emergency policies in writing.

But while providing a safe working environment should be a priority, Dixon said, it can be a distraction from core business activity and suggest ways for owners and managers to maintain their core focus.

“With numerous low-cost outsourcing options now available, small business owners and managers no longer have to tackle complex health and safety issues alone,” said Dixon. “The solution for many owners and managers is to outsource their health and safety requirements, in the same way they outsource other non-core functions of the business.”