Can I claim for an injury if my employer was not insured?

Updated: October 15, 2020

Yes. You have a right to claim compensation for a work accident regardless of whether your employer had valid Employers' Liability insurance.

However, making a personal injury claim against your employer will involve negotiating with their insurance company to reach a settlement. It is the insurance company that actually pays out the compensation award.

If your employer does not have insurance in place, they may not be able to afford the cost of a compensation settlement. This article looks at what happens if you are injured at work but your employer was not insured, or their insurer has ceased trading.

Is an employer without EL insurance breaking the law?

Yes, in most cases. Under the Employers’ Liability (Compulsory Insurance) Act 1969, the majority of UK employers are legally required to hold Employers Liability (EL) Insurance.

EL insurance is designed to cover the cost of financial compensation if an employee is injured or made ill by their work. Most successful compensation claims are paid out by the EL insurance provider and not directly by the employer.

However, if your former employer or their insurer has gone out of business, it is still possible for you to receive compensation for work-related injuries or illness.

The insurance company’s insolvency practitioners may be able to provide you with the compensation you are owed if the company has enough assets to meet your claim.

If the company cannot afford to pay your compensation, you can seek compensation through the Financial Services Compensation Scheme (FSCS).

The Financial Services Compensation Scheme (FSCS)

The Financial Services Compensation Scheme (FSCS) is designed to give statutory protection to businesses by offering compensation to anyone affected by a financial services organisation - such as an insurance company - going bust.

Claiming through the FSCS is only available in specific circumstances, where an employer's insurance provider is unable to settle a claimant's claim, and the employer has recourse to the FSCS.

The government-backed scheme has two main objectives:

  • Maintaining continuity of insurance (by finding another insurance company to take over a policy).
  • Providing compensation to policyholders if an insolvent insurance company is not able to pay claims.

As it is a legal obligation for employers to take out Employee Liability Insurance, the FSCS will pay out 100% of any valid compensation claim.

How will my claim work in practice?

The first steps in a personal injury claim will involve your injury lawyer gathering medical and other evidence to show that your employer was legally responsible for the accident and the ensuing injuries. This is the case no matter what the status of the insurance company at the time of the claim.

If the insurance company or its insolvency practitioners cannot pay the compensation, an agent will be appointed by the FSCS to review the claim. If, as in the majority of cases, liability is admitted, you will not be required to go to court.

Your injury lawyer will negotiate with the FSCS on your behalf, with a view to obtaining the highest level of compensation possible and will ensure that you are not out of pocket.

Have you been injured at work?

If you have been injured at work in the last 3 years, you may be able to claim financial compensation.

Find out more about making a work accident claim:

  • Do you qualify?
  • How much compensation could you get?
  • How does No Win, No Fee work?

Read more: Work accident claim guide

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