For large building firms, the premium for combined liability cover is based on what factors?

The premium for combined liability cover for large building firms is primarily based on the number of employees. This is because the more employees a firm has, the greater the potential for incidents that could lead to liability claims. The workforce size can influence the exposure to risk; for instance, a larger number of employees may lead to a higher likelihood of accidents occurring on site, which in turn raises the insurer's potential liability. Therefore, insurers will assess the number of employees when calculating premiums, considering the associated risks of increased workforce size in relation to liability coverage.

While the average number of contracts, location of the risk, and the number of years trading without a claim may also play significant roles in overall risk assessment, the direct relationship between employee numbers and potential claims for combined liability is a critical factor influencing premium costs. This metric provides a clearer indication of the firm's operational scale and its exposure to liability claims.