Employers' liability is priced against the wage roll, which makes it look like a simple percentage and makes it behave like nothing of the sort. The rate applied to that wage roll is set by what the insured people do, and the range across trades is wide enough to swamp the payroll figure itself.
The rate, not the payroll, is the variable
Insurers apply a rate per unit of wages, and that rate is the whole argument. Office and clerical work sits at one end because the serious injury frequency is low. Roofing, scaffolding, demolition and work involving heavy plant sit at the other, because a single accident can produce a claim far larger than any plausible premium. A business whose staff are split across categories is rated across those categories, which is why an accurate wage split is worth more than a negotiated discount.
Claims experience, and how long it follows you
Insurers usually look back five years, and they care about frequency as much as severity. A run of small claims signals a management problem and prices worse than one large unlucky event. Employers' liability claims are also slow: a disease claim can surface long after exposure, which is why insurers ask about historic activities and why keeping old certificates is more than housekeeping.
What raises it beyond the obvious
Several things move the rate that are not about the trade. Work carried out away from your own premises, work at height, use of hazardous substances, night work, lone working and young or newly recruited staff all attract attention. So does a poor or absent record of risk assessment, because that is what the insurer will be defending if a claim is made. Improving those is slower than shopping around and moves the number further.
The adjustment nobody budgets for
Most policies are placed on an estimated wage roll and adjusted afterwards. A business that grows through the year, takes on seasonal staff or moves subcontractors from bona fide to labour only will owe an additional premium at adjustment. It is a normal feature of the cover rather than a penalty, but it lands as an unexpected invoice for anybody who treated the original quote as the final cost.
Questions people ask about employers liability insurance cost
Is employers' liability priced on turnover or wages?
On wages, split by what the people do. Turnover is used for other covers and is not the base for this one.
Why did my premium increase without new claims?
Usually a wage roll adjustment, a change in the mix of work, or a market wide rate movement. Ask for the rate as well as the premium so the two can be separated.
Does a small claim history matter?
Yes. Frequency signals a systemic issue and often prices worse than a single large event, because insurers read it as a predictor.