Recruitment Agency Insurance

Recruitment, staffing and employment are hot topics at the moment with the UK’s employment rate estimated at 75.1%, 1.4 percentage points lower than in 2020. Recruitment agencies have a more crucial job now than ever to get people back to work after the pandemic. It is for this reason that agencies need to ensure that they have the right insurance and are covered correctly. Below, we have some examples of scenarios that could go wrong in the recruitment industry, as well as which covers would protect against these.

Professional Indemnity Claims


One of the most common claims is misrepresentation, where a recruitment agency is accused of not checking a candidate’s references, or misrepresenting the candidate’s experience or qualifications, to ensure that they get the job.  Clients will usually claim for their re-recruitment costs and any other expenses that they have incurred. 


The second most common claim is hiring clients withholding their feeds because of a dispute over performance, or if they say the agency has been negligent. If a large client is withholding a fee they owe you, this could cause problems for the business as a whole. It is important to have a cover in place to protect you and your business against this. 


These are just two examples of problems that could go wrong in regards to professional indemnity claims. Professional indemnity insurance protects business owners, freelancers, and the self-employed if clients claim that a service is inadequate. Professional indemnity insurance is not a premise-based cover so it doesn’t matter where you are working, you will still be covered. 

Employers & Public Liability Claims

If you have employees, whether they work part-time, full-time or are under another contract, you will need employers liability insurance. This type of insurance will protect your business against legal and compensation claims. If an employee falls or sustains an injury at work, this type of cover will protect you. Employers are legally obliged to have employers liability insurance and you can be fined if you are found not to have this cover. 


It would also be beneficial to be covered for public liability claims. An example of this is, if you have recommended someone for a care worker position and they fail to look after the patient properly, you could be blamed. 


Public liability insurance will cover your business for legal action if you are found liable for the injury of a person, loss or damage to property or economic loss resulting from negligence.

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We are truly independent, meaning we can go to the whole market seeking the best deal for our clients.

We have been awarded Chartered status. This is testament to our expertise, industry knowledge and excellent client service.

Our in-house claims team will deal with any claims that may arise in an efficient, personal and professional manner, leaving you free to continue with the important work of running your business.

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Points of Consideration for Recruitment Agents & Agencies

1. Unsuitable Candidate Claim

Even with well-written briefs and terms of business, client disputes can still occur when things go wrong and costs will incur because the candidate was deemed unsuitable after starting employment.


2. Candidate Misrepresentation 

Misrepresentation claims revolve around missing qualifications or skills which were claimed before placement and can no longer be proved or don’t exist. 


3. Temporary Staff Claims / Vicarious Liability Claims 


4. Breach of Duty of Care

The law dictates that a recruiter owes you an enhanced duty of care. When your advice or service doesn’t meet a client’s expectations and a physical or financial loss is incurred, they might try and make a claim against your recruitment consultants’ professional indemnity insurance. 

  1. Intellectual Property / Breach of Copyright 
  2. Loss of Data / Documents 
  3. Drivers Negligence
  4. Breach of Confidence

Cyber & Privacy Liability

Recruitment agencies have a huge database of information, the majority of which is confidential.

These documents include salary details, bank details and much more. Due to this, it is imperative to have full cyber and privacy coverage in case of a cybersecurity breach, a virus or a hacking attack.

Cyber insurance generally covers your business for a data breach involving private customer information. You could also consider adding privacy liability insurance to your policy as this will cover any losses that come about due to a businesses failure to protect sensitive, personal or corporate information. 


Insurance will help to take some of the worries and stress out of running your business and will also help your business to grow.

Other Insurances Relevant To The Industry

Other insurance types which are perfect for recruitment agencies include: 

–     Directors & Officers Insurance – This covers the costs of defending you as a director or officer of your business against allegations against wrongful acts and any damages against you. 

–      Office Insurance – Office insurance covers your office building, any contents in it and any computer equipment against any damage. You will be able to choose what you cover in this policy.  

Find out which of the above you will need for your business on 0117 325 2224 where a member of the team will advise you further.


Any business owner in this industry in this sector will know how costly these incidents can be, it can be as simple as a missing reference to a serious accident at work. Recruitment insurance is essential to protect you in case something should go wrong! Speak to the experts today about how we can ensure your business is protected. 


Click here for more information on recruitment insurance. To discuss your requirements, contact one of our specialists on 0117 325 2224.

We are the right people for you

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