{"id":12776,"date":"2026-07-07T14:59:58","date_gmt":"2026-07-07T13:59:58","guid":{"rendered":"https:\/\/www.policybee.co.uk\/blog\/?p=12776"},"modified":"2026-07-08T09:26:47","modified_gmt":"2026-07-08T08:26:47","slug":"sole-trader-need-employers-liability-insurance","status":"publish","type":"post","link":"https:\/\/www.policybee.co.uk\/blog\/sole-trader-need-employers-liability-insurance","title":{"rendered":"Do sole traders need employers’ liability insurance?"},"content":{"rendered":"\n

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\"A<\/figure>\n<\/div>\n\n\n

It\u2019s one of those insurance questions that sounds like it has an obvious answer.  <\/p>\n\n\n\n

You\u2019re a sole trader. You work for yourself. You don\u2019t employ anyone.  <\/p>\n\n\n\n

So you don\u2019t need employers\u2019 liability (EL) insurance<\/a>, right? <\/p>\n\n\n\n

Well, yes. Often that\u2019s true. But not always. <\/p>\n\n\n\n

Being a sole trader doesn\u2019t always mean working completely alone. And that\u2019s where things can get a bit more complicated.  <\/p>\n\n\n\n

If you ever bring in help, even occasionally, you could still need employers\u2019 liability insurance.  <\/p>\n\n\n\n

So before you tick the \u2018not needed\u2019 box and move on to other pressing matters, it\u2019s worth understanding where to draw the line when it comes to EL.  <\/p>\n\n\n\n

It\u2019s the only legally required<\/strong> business insurance you\u2019re likely to need\u2026and hefty fines await those who are caught without it when they should have it.  <\/p>\n\n\n\n

<\/p>\n\n\n\n

What is employers’ liability insurance?<\/strong><\/h2>\n\n\n\n

Employers\u2019 liability insurance covers claims from people who become ill or injured because of the work they do for you. <\/p>\n\n\n\n

If they claim you were responsible, EL can help cover legal costs and any compensation you\u2019re required to pay.  <\/p>\n\n\n\n

In the UK, most businesses that employ people must have it by law. Except for the ones who only hire close family members. As well as a few other niche exceptions<\/a>.  <\/p>\n\n\n\n

So far, so straightforward.  <\/p>\n\n\n\n

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Why most sole traders assume they don’t need EL<\/h2>\n\n\n\n

Most sole traders don\u2019t think of themselves as employers.  <\/p>\n\n\n\n

And in many cases, they\u2019re right not to.  <\/p>\n\n\n\n

If you genuinely work alone and never use anyone else\u2019s help, employers\u2019 liability insurance probably won\u2019t be relevant to your business.  <\/p>\n\n\n\n

But here\u2019s where the confusion starts. \u2018Employee\u2019 doesn\u2019t always mean someone on your payroll with a permanent contract\u2026 <\/p>\n\n\n\n

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Do I need employers’ liability insurance for everyone who works for me?<\/h3>\n\n\n\n

It\u2019s not just about job titles. According to the Health and Safety Executive (HSE)<\/a>: <\/p>\n\n\n\n

“Whether you choose to call your contract a contract of employment or a contract for services is largely irrelevant. What matters is the real nature of your relationship with the people who work for you and the nature and degree of control that you have over the work they do<\/strong><\/em>.” (From the Employers’ Liability (Compulsory Insurance) Act 1969 – a brief guide for employers<\/a>.)<\/p>\n\n\n\n

In other words, the HSE doesn’t differentiate between types of worker purely because of their tax status or your contractual relationship with them. <\/p>\n\n\n\n

What matters is how someone works with you, how much control you have over their work, and whether you effectively act as their employer.  <\/p>\n\n\n\n

That means you could be a sole trader and still have responsibilities towards people who help you with their work.<\/p>\n\n\n\n

<\/p>\n\n\n\n

Who counts as an ’employee’?<\/h2>\n\n\n\n

You might be surprised by some of the people that fall under the HSE\u2019s definition of an employee. Depending on the circumstances, your employees can include: <\/p>\n\n\n\n