The short version
- Employers' liability is for your staff. Public liability is for everyone else.
- Public liability is generally voluntary, but contracts often demand it.
- Neither one pays for your own injury or your stolen tools.
These two covers are often sold together, so it is easy to treat them as one product. They answer different questions. The first thing to ask of any incident is simple: who was hurt, or whose property was damaged?
Employers' liability
Employers' liability pays compensation when an employee is injured or becomes ill because of their work for you. That includes former employees, and it applies whether the harm happened on or off site. Injuries from motor accidents while working may fall under your motor policy instead.1
It is compulsory for most employers, with a minimum of £5 million of cover.2 That minimum includes costs, so HSE suggests considering whether you need more. It notes that most insurers offer at least £10 million in practice.1
Public liability
Public liability covers claims from members of the public or from other businesses. It does not cover claims from your employees, and it is generally voluntary.1
Voluntary in law does not always mean optional in practice. A main contractor or commercial client may make a set level of cover a condition of the job. Read the contract before you choose a limit, because buying less than it requires can cost you the work.
Who pays in common situations
The table shows where each incident would normally land. Your own policy wording always decides the outcome.
| What happens | Usually a matter for |
|---|---|
| A customer trips over your cable | Public liability |
| You damage a neighbour's wall while working | Public liability |
| Your employee falls from a ladder | Employers' liability |
| A worker under your direct control is hurt | Possibly employers' liability, depending on their real status |
| An employee is injured in a crash in your van | Possibly motor insurance |
| Your tools are stolen | Neither. Look at tools cover |
| You are a sole trader and injure yourself | Neither. Look at personal accident or income protection |
| The job you are building is damaged before handover | Neither, as a rule. Look at contract works or contractors' all risks cover |
Which do you need?
- Working alone with no employees: employers' liability is unlikely to be required, but check the status of anyone who helps you. Public liability is the cover most likely to matter.
- Employing anyone: employers' liability is required unless an exemption applies, and public liability is still worth having.
- Using subcontractors: work out their real status first. Our guide to the subcontractor test explains how.
- Working for main contractors: find out the limits they require before you buy.
Common questions
Is public liability insurance a legal requirement?
Generally no. HSE describes it as generally voluntary. A client or main contractor can still require it.
Does public liability cover my employees?
No. Claims from employees fall under employers' liability.
Sources
- Employers' Liability (Compulsory Insurance) Act 1969: a brief guide for employers (HSE40 rev4), Health and Safety Executive. Accessed 11 November 2026.
- Employers' liability insurance, GOV.UK. Accessed 11 November 2026.
General information only. This is not legal, insurance or financial advice. Your own policy wording decides what is covered.