Employers’ liability is one of the most critical compliance areas for any business operating in Cyprus.

A workplace accident or an occupational disease can lead to significant financial claims. For this reason, the law imposes specific obligations on employers.

However, many employers are not fully aware of their responsibilities or mistakenly believe that this obligation applies only to large companies or high-risk professions. In reality, employers’ liability applies to almost every form of employment, including the hiring of domestic workers in private households.

10 Things Many Employers Overlook

1. Employers’ liability insurance is mandatory by law
2. It applies to small businesses
3. It also applies to private individuals employing staff at home
4. It covers occupational diseases
5. Compensation amounts can be very high
6. Liability may arise even from simple negligence
7. Legal expenses can be significant
8. Liability may arise years after exposure to risks
9. Insurance is often a requirement for employment procedures
10. Insurance protects both the employer and the employee

Key Points Every Employer in Cyprus Should Know

1. Employers’ Liability Insurance is Mandatory

In Cyprus, every employer is legally required to maintain insurance covering their liability towards employees.

This obligation arises from the Employers’ Liability (Compulsory Insurance) Law of 1989 (Law 174/1989).

More information:
https://www.cylaw.org/nomoi/enop/ind/1989_1_174/index.html

This insurance covers compensation arising from:

• Employee injury
• Permanent disability
• Death of an employee during the course of employment
• Occupational diseases

2. Minimum Limit of Indemnity: €160,000

The law requires a minimum insurance limit of €160,000 per employee.

However, in practice, court awards may be significantly higher.

Employers’ liability also includes coverage for occupational diseases, not only accidents.

3. Liability is Not Limited to Hazardous Occupations

Workplace accidents can occur in any environment:

• Offices
• Warehouses
• Retail stores
• Hotels
• Construction sites

Even a simple slip or fall can result in a compensation claim.

4. Employers Must Provide a Safe Working Environment

Employers have a duty of care to ensure the health and safety of their employees.

This includes:

• Appropriate equipment
• Staff training
• Safety procedures
• Proper maintenance of equipment

5. Compensation Can Be Substantial

In serious workplace accidents, compensation can reach hundreds of thousands of euros, especially in cases involving permanent disability or loss of income.

Legal Framework in Cyprus

Employers’ liability insurance is a legal obligation for all employers.

A. Purpose of the Legislation

The law aims to ensure that:

• Employees are compensated in case of injury
• Employers are financially protected from large compensation claims

Liability applies to incidents occurring:

• During working hours
• At the workplace
• While performing job duties

B. Who is considered an Employee

An employee is any person working for an employer:

• Under a contract of employment
• For salary or wages
• Under the direction and control of the employer

Examples include:

• Office staff
• Laborers
• Technicians
• Salespersons
• Warehouse staff
• Cleaning personnel

C. Domestic Employees Are Also Covered

The obligation also applies to private individuals employing staff at home, such as:

• Domestic helpers
• Caregivers
• Gardeners
• Household workers

Employers’ liability insurance is often a requirement for obtaining work permits for foreign domestic workers.

More information:
https://www.moi.gov.cy/crmd

D. Minimum Cover & Occupational Diseases

The minimum limit remains €160,000 per employee.

Employers’ liability also extends to occupational diseases, which arise from exposure to workplace risks.

In Cyprus, occupational diseases are listed in the Official Gazette of the Republic.

Examples include:

• Silicosis
• Asbestos-related diseases
• Occupational hearing loss
• Diseases caused by heavy metals
• Skin conditions due to chemical exposure

More information:
Department of Labour Inspection
https://www.mlsi.gov.cy/dli

Social Insurance Services
https://www.mlsi.gov.cy/sid

E. Consequences of Non-Compliance

An employer who fails to maintain employers’ liability insurance commits a criminal offence.

Consequences may include:

• Financial penalties
• Criminal sanctions
• Personal liability for compensation

In the event of a workplace accident without insurance, the employer may be required to pay the full compensation personally.

What an Employers’ Liability Policy Typically Covers

An employers’ liability insurance policy may cover:

• Compensation to employees
• Medical expenses
• Legal costs
• Defense costs
• Loss of income compensation

Coverage always depends on the specific policy terms and conditions.

Common Misconceptions

❌ “It only applies to large companies”
✔ It applies to all employers

❌ “Social insurance covers everything”
✔ Social insurance does not cover civil liability claims

❌ “Domestic helpers do not require insurance”
✔ Insurance is mandatory

Minerva Insurance is your Protection Partner

At Minerva Insurance, we understand that behind every business and every household employing staff there are people. Protecting those people is not just an obligation; it is a priority.

Employers’ liability insurance is your shield against unexpected events such as workplace accidents or occupational diseases. A single incident can lead to significant compensation, medical expenses, or even legal proceedings costs that can seriously affect your financial stability.

Minerva Insurance provides solutions when choosing Employer’s Liability Policy:

✔ You protect your business or household from serious financial risks
✔ You ensure immediate and responsible response to any incident
✔ You strengthen trust and security among your employees
✔ You demonstrate a modern and responsible employer profile

Employers’ liability insurance is not just something you “must” have, it is a smart decision that protects today and secures tomorrow.

At Minerva Insurance, we offer tailored employers’ liability solutions designed to meet the needs of both businesses and private individuals employing staff.

Because employers’ liability insurance is not only a legal obligation, it is also a commitment of responsibility towards the people who contribute daily to your business or household.

Choose Minerva Insurance and secure solutions tailored to your needs, with reliability, flexibility, and meaningful protection.
Contact our specialized intermediaries, visit our website, or one of our local offices for immediate and personalized service.

Tonia Despoti

Product Development & Training Manager