Recruitment Insurance
Business guide about recruitment agency insurance
With the right recruitment insurance in place, you can protect your business from the threat of expensive liability and property claims. Recruitment agency insurance is important as they face several risks when placing candidates into new roles, it could be that confidential details are shown in error or a cyber-attack compromises sensitive data.
Which providers specialise in professional indemnity insurance for recruitment agencies?
There are a number of insurers which will provide specialist coverage to recruitment agencies. Professional indemnity insurance remains the most important consideration when arranging your coverage. Civil liability insuring clauses ensure the greatest protection against claims for compensation from your candidates and/or the companies you work with.
What is recruitment insurance?
Recruitment insurance is usually a package of liability and property insurance, the main types of cover are detailed below. Additional protections, such as personal accident and legal expenses can also be included.
It's worth considering whether your professional indemnity insurance also provides cover for vicarious liability. This is especially important for the placement of temporary staff because not all policies will provide this extension.
Recruitment agencies can handle a significant amount of personally identifiable information and ensuring you are adequately protected with cyber insurance in the event of a data breach or cyber attack can save you a lot of time and cost.
Do recruitment agencies need specialist insurance?
Discuss your recruitment insurance needs with one of our experts, to ensure the solution you arrange is adequate to protect your agency from future claims. Recruiters are exposed to unique risks that should be taken into consideration:
1.) Vicarious liability
Ensure you have protection whereby you can be held accountable and financially libel for the actions of the candidate you placed with your client.
2.) Cyber insurance
Third party liability will typically be provided under your professional indemnity, but 1st party cyber coverage is becoming increasing important.
3.) Drivers negligence
If you are supplying drivers into businesses this is an important extension that should be included on your professional indemnity insurance.
Compare recruitment insurance cost from the leading providers with Get Indemnity™ a Willis Towers Watson Network Broker
Find recruitment agency insurance that is designed to meet your business needsWhat types of recruitment insurance cover is typically purchased?
Property Damage
Provides cover for the cost of repairing and restating your property after an insured incident and can also include buildings insurance, contents insurance, portable equipment insurance, and business interruption insurance.
How much does recruitment insurance cost?
We would always recommend that you buy recruitment insurance based on the cover rather than price. However, that being said we can provide access to some very competitive premiums to manage your costs.
The cost of recruitment insurance depends on the cover you chose to take out, how much of each cover you buy i.e., the limit of indemnity, the number of staff you have, the size of your business, area of speciality, and your claims history.
For example, if your recruitment agency specialises in supplying top executives into the venture capital sector on high salaries your professional indemnity insurance is likely to cost more than if you place manual workers into smaller firms.
What additional insurance for recruiters is available?
Talk to an expert about recruitment insurance that can protect your business when you need it most
Frequently asked questions
Why is vicarious liability insurance important to recruiters?
There are two types of recruitment insurance, non-vicarious and vicarious and it is important to know the difference, non-vicarious insurance only covers you for your business and does not cover any candidates that you have placed if there is a claim of negligence of injury to the candidate. Vicarious insurance covers the work your candidates do for your clients.
What is drivers negligence insurance cover?
Drivers negligence insurance is important if you are supplying drivers into businesses. Drivers negligence insurance provides cover for accidental damage caused to a business's vehicle being driven by a worker you have supplied to them, avoiding the need for them to claim on their own insurance which would negatively affect their claims experience. Drivers' negligence insurance is usually an extension to the public liability insurance and not a standalone policy.
Should our recruitment firm purchase directors' and officers' insurance?
Directors, officers and senior managers are under increasing scrutiny when it comes to running a business and their decisions can result in allegations of wrongdoing, it is often assumed that the directors of a company are not personally liable for mistakes but that is not the case, even in a limited company the personal liability of directors is unlimited. To protect themselves directors, buy directors and officers insurance which will pay the costs in defending an allegation as well as the compensation costs. The directors of recruitment firms should consider this an essential part of their insurance program.
Do recruiters need 1st and 3rd party cyber insurance?
With the continued rise in cyber-attacks with four in ten businesses having reported a cyber breach in the last 12 months, cyber insurance is a must have for any business using a computer. There are two distinct types of cyber cover. Firstly, first-party insurance which covers your own damages from a cyber-attack and secondly, third-party cover which covers the expenses incurred if you cause another firm cyber loss. Having both covers would give you and your clients peace of mind if the worst happens, and you suffer a cyber loss.
Why do recruiters need professional indemnity insurance?
Professional indemnity insurance is essential for recruiters and recruitment agencies because it enables the business to defend allegations of negligence, for example if a candidate thought you’d given them poor advice. Professional indemnity insurance also provides cover for allegations of copyright infringement, defamation, libel and slander covering any legal costs of expenses incurred defending allegations and paying compensation, removing the need for you to pay these costs out of the company bank account.
Related articles and guides
Claims brought under negligence occur when a service provider doesn’t perform their responsibilities to the level required of a reasonably competent person within their profession.
DAS Law highlights ten important areas of the law that HR professionals and business owners need to be aware of .