Recruitment Agency Insurance

When Simply Business wanted to have a guest post, I said fine so long as it is informative and as they are specialists in our industry then it made sense, this is their post below:

Buying insurance for your recruitment agency

Finding the right package of insurance for recruitment agencies is important but potentially puzzling. There are various different factors that will affect the cost of your cover, and several different policy components that need to be considered.

Clients are becoming more demanding when they do business with recruitment agencies, often seeking proof of insurance before choosing one agency above others. Getting the right recruitment agency insurance is therefore not only essential for keeping you properly covered, but can also serve as a key highlight when promoting your business.

Types of recruitment agency insurance

As your recruitment agency offers a professional service to other businesses, professional indemnity insurance is an important cover; if your recommendations are seen to damage a client’s business, they may deem you responsible. Professional indemnity policies are there to cover legal costs incurred from mistakes made, and negligence such as the loss of data or documents. You should also think about the potential for infringement of intellectual property rights and defamation; recruitment agencies deal with abundant personal information and trade in a currency of personal and professional reputation. If this is unintentionally damaged or defamed, then this covers claims.

Employment agency insurance policies are also likely to include public liability insurance, which is a cornerstone cover for many businesses. If you or your recruitment agency accidentally injures someone, or if a third party’s belongings are damaged, then this is the insurance that steps in to cover your costs. As many recruitment agencies have job-seeking clients coming in and out of the premises, covering injuries or accidents on your premises could be key.

There are other policy parts that can be important for recruitment agencies too. Simply Business can tailor business premises cover if necessary, with options such as buildings cover, contents cover, and cover for fixtures and fittings. You also need to bear in mind that the law requires employers’ liability insurance if you have employees, so that you are able to compensate employees for injury or illness that they attribute to their work.

Ready to request a quote? Bear in mind…

You will be asked some specific questions when you request a quote from Simply Business for recruitment agency insurance, and your answers will affect the premium you pay. If you place manual workers in jobs, then you will pay more, as manual jobs carry greater risks of a claim that could impact the agency along the line. We will also want to know the kind of places you provide your services to. If the businesses you work with include high-risk locations such as power or nuclear stations, anything to do with aircrafts or aviation, watercrafts, railways, or medical facilities, then this will make a big difference. Dealing with businesses of this type means that many insurers may refuse to cover you all together, and other providers may offer an extortionate premium. It’s important to keep this in mind when taking on clients of this kind.
We will also need to know whether you accept liability for the candidates you place. Some candidates work as employees for the agency even when working in an external workplace, while other agencies collect a one-off fee and then relinquish responsibility for the candidates. These liability concerns will also push your premium up or down.


  1. Thanks for the great article Stephen. We’ve also seen an increase in the amount of new clients that are asking for proof of liability insurance recently. I think it’s also important for recruitment firms to take a look at their current insurance policies to ensure that the coverage it provides is adequate for the current business activities they conduct.

    – Laura Mason

  2. Hi Stephen, insurance is a major concern, especially in the executive recruitment market. Thanks for the details on requesting a quote, (the high risk industries part) they’ll come in handy. – Charles

  3. These kind of insurance will not only bring benefits to the agencies and the customer – it will also bring benefit to the people which are “sold” as companies need to do better preperation before “selling” someone somewhere.

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