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What Contractors Need to Know About Umbrella Company Insurance

If you’re working as a contractor, you won’t usually be covered by your end client’s employee insurance. As a result, the contract will call for you to be covered by a series of insurance policies. If you’re employed by an umbrella company, they will provide the necessary insurance and, in this article, we’ll look at what you can expect them to provide and when it might be needed.

As a minimum you can expect your umbrella company to provide:

Professional Indemnity

Professional indemnity insurance covers your umbrella company for loss or damage to the end client for negligent services or advice provided by their business. In other words, if you do sub-standard work and it causes your client to lose money, your umbrella company’s professional indemnity insurance will cover the loss.

Public liability

 This covers your umbrella company for legal or compensation claims from other parties for incidents involving their business. Again, this means that if issues arising from your work or your actions as their employee cause injury, loss or damage to a third party, your umbrella company’s public liability insurance will cover it.

Employer’s Liability

As the name suggests, this covers your umbrella company for liabilities that arise because they are your employer. For example, if you are injured while at work the claim would be made against your umbrella company’s employer’s liability insurance. This kind of cover is compulsory for all UK employers.

Referred activity

The vast majority of contractors will be covered by the standard policy their umbrella company has in place, but if your field involves unusual or heightened risks it’s important to confirm that you’re covered. For example, some jobs or industries may be excluded from the standard policy due to increased risk. This could include:

  • Vets, doctors or dentists

  • Banking or investments

  • Demolition

  • Ship’s crew

If you’re not covered by their standard policy, your umbrella company may be able to extend their cover if necessary, and depending on the specific details this may or may not come at an additional cost.  

If you’re not employed by an umbrella company

Contractors who operate through their own Limited company or as self-employed sole traders are responsible for their own insurance. It’s important to have appropriate cover to protect yourself and your business, and your clients are likely to insist on a minimum level of cover.

If you’re employed by Orange Genie Umbrella

Cover in place for all employees and CIS self-employed sub-contractors:

Employer’s Liability - £10 million

Professional indemnity - £5 million

Public liability - £10 million

Driver’s negligence insurance can be added as an extension to our liability insurance on request. We have had cyber insurance in place for a number of years. 

If you’re not with us yet and have questions about this issue, or if we can help in any way, please contact our expert team on 01296 468 483 or email info@orangegenie.com.

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