Understanding Employers Liability Insurance

Your employees are essential to the running of your business, so it makes sense to have all the right measures and insurances in place to help keep them safe and protected. While there are many different types of insurances available to cover aspects of your business, Employers Liability insurance* is one which you may need to consider when you have a team of staff working for you. 

We will take a look at the coverage and some of the reasons why your business may need to consider having this type of business insurance in place.  

What is Employers Liability insurance? 

You may take all the care in the world to ensure that your working environment is safe and secure, but the unfortunate reality is, accidents and undesirable challenges can still happen, especially when we least expect them. 

Employers Liability insurance protects you against settlements or damages, including defence costs, as a result of an employee suffering bodily injury arising out of their employment (where the Accident Compensation Commission (ACC) does not provide cover (such as gradual impairment injuries). 

This is a brief overview of what is typically included in an Employers Liability insurance policy: 

What is typically covered? 

  • Costs of settlement or damages arising from claims for personal injury to employees in the course of employment 
  • Legal costs incurred as a result of defending these claims 
  • Claims not covered by the ACC 

These are some claim examples of where Employers Liability insurance may provide cover: 

  • Occupational stress and mental injury 
  • Nervous shock or fright 
  • Heart attack or stroke caused by stress 
  • Disease arising from circumstances where the employer has failed to provide a safe workplace 


Why does your business need to consider Employers Liability insurance? 

Sometimes known as EL, Employers Liability insurance protects your business, as an employer, against claims that may arise from your employees. These claims may be for things like sustaining an injury whilst performing their duties on the job, where the Accident Compensation Commission (ACC) does not provide cover.  

The risk of not having Employers Liability insurance, may threaten your financial position, requiring the funds to pay the compensation for a claim, and not to mention the legal costs which are also involved with the process. 

Examples of some of the kind of injuries the ACC may cover 


The ACC provides cover for certain claims relating to the workplace. To get an idea these are some examples: 

A physical injury is when there is actual damage to your body. This includes: 

  • sprains or strains – such as the ankle, back, knee or shoulder sprains 
  • wounds – cut, broken or bruised skin 
  • burns 
  • fractures 
  • dislocations 
  • dental injuries 
  • hearing loss 
  • concussion and loss of consciousness. 


The ACC may also cover most physical injuries if they’re caused by: 

  • an accident 
  • sexual violence 

They can cover injuries or conditions that happen over time and are caused by the type of work you do. This is known as gradual process conditions. The ACC will need to establish if your work tasks or workplace environment are causing your condition.i 

Examples of some of the injuries that are not covered by the ACC 


When injuries are not caused by an accident, the ACC will typically not provide cover for: 


  • illness, sickness, or contagious diseases, eg measles 
  • stress, hurt feelings or other emotional issues. This is unless they’re linked to an injury we already cover 
  • conditions related to ageing, eg arthritis 
  • most hernias 
  • injuries that happen over time, unless an activity at work is causing it 
  • damage to items that don’t replace body parts. This includes hearing aids, glasses, pacemakers and gastric bands.ii 


Creating a safe workplace 

As a small business owner, you have a responsibility to ensure your workplace is safe for your employees. There are a few simple things that you can do to help make sure that you are protecting your employers in their working environment. 

  • Conduct regular assessments of your workplace, including things like machinery 
  • Make sure your employees receive regular training across a variety of key topics like occupational health and safety 
  • If relevant, for those in physical roles that involve lifting and moving items, make sure that they are doing so correctly and safely to avoid any injuries from occurring 
  • Keep track of your employees and their workplace wellbeing with things like identifying their current work process, desk set-ups etc 
  • If an injury does occur, help get your employee back on track faster by providing return-to-work assessments and ways to ease them back into the role, limiting the risk of further injury occurring. 


Protect your business with insurance 

We’ve already taken a look at Employers Liability insurance, and some of the ways to keep your employees safe. Protecting your business with other business insurance can help to keep your business safeguarded from unwanted challenges and to be in business for the long run. 

Things like Public Liability, Professional Indemnity and other Business Insurance options*, help protect different areas of your business. There isn’t a one size fits all when it comes to business insurance, with each and every business exposed to its own unique risks. 

At Public Liability Insurance, we enable you to access multiple quotes to compare from selected leading New Zealand insurers, so you can choose the right cover to protect your business.   

Our online insurance platform means you can get covered in minutes without having to worry about filling out mountains of paperwork. Once your policy is arranged, we will deliver the documents straight to your inbox – no snail mail required.  

*This information is general only and does not take into account your objectives, financial situation or needs. It should not be relied upon as advice.  As with any insurance, cover is subject to the terms, conditions and exclusions contained in your policy document.   

Public Liability Insurance is a trading name of BizCover Limited.  BizCover Limited is owned by BizCover Pty Ltd (ABN 68 127 707 975). 

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