What is Employer’s Liability Insurance?

Get covered – not caught out. Businesses must have employer’s liability insurance.


As an employer, it’s your responsibility to protect the health and safety of your employees during working hours. No matter how safe you think you are, workplace injuries can happen when you least expect them. If your employee gets injured or becomes ill while working for you, they may try to claim compensation from your business.

Employer’s liability insurance is one part of a workers’ compensation insurance policy. In essence, it covers liability arising out of employees’ work-related injuries that aren’t covered by the first part, specifically, lawsuits.

Employer’s liability insurance usually covers all types of employer’s liability claims unless the policy specifically excludes them, although, some claims are more common than others. Employer’s liability lawsuits typically involve one or more of the following four claims:

  • Third party over actions: For example, if an employee falls off a ladder, but instead of filing a workers’ compensation claim, files a lawsuit against the ladder manufacturer. The ladder manufacturer then files a third party cross-claim against the employer for failure to properly maintain the condition of the ladder.
  • Consortium and other loss of services to family members: An injured employee’s spouse could serve your business with a lawsuit because their spouse is no longer able to contribute to the marriage or household.
  • Dual capacity claims: An employee can file this type of lawsuit against their employer when a product the employer manufactures is the cause of their injury. You could be liable as both an employer and as a manufacturer.
  • Consequential bodily injury: If your employee’s family members suffer injuries as a result of the employee’s injury, they could sue your business.


Luckily, when these claims happen, employer’s liability insurance can cover your business’s:

  • legal defense fees;
  • settlements;
  • damages or judgments;
  • other court costs.


Don’t wait until a casualty happens to find out that your coverage isn’t enough. Visit the team at Martplan Insurance Agency for the commercial insurance that you need in La Habra and surrounding cities in California.