Tradesman insurance

Find out what type of insurance you need as a tradesman or tradeswoman and how much it's likely to cost.

Whether you’re a builder, decorator, electrician, plumber or handyman, your customers rely on your skill, expertise and judgement. However, jobs like these come with a long list of hazards and risks, and so it’s good to make sure you are covered in case of accidents, or even mistakes.

Tradesman insurance covers you against injury, disagreements and the loss of tools or equipment.

What is tradesman insurance?

Tradesman insurance provides cover for tradesmen and tradeswomen against a range of risks. This type of cover suits freelance and independent contractors best. If you are employed by another company, taking out this cover is not your responsibility.

What does tradesman insurance cover?

Levels of cover will vary between insurers, but most policies will typically include a combination of business insurance essentials.

These usually include:

  • Tradesman liability insurance. Liability insurance covers you in case another person is injured or their property is damaged and your business is legally liable.
  • Professional indemnity insurance. Indemnity insurance covers the cost of unforeseen circumstances and mistakes for both self-employed people and for businesses.
  • Employers’ liability insurance. If you employ staff, you are legally required to take out employers’ liability insurance, to protect both your crew and yourself in case legal action is taken against you.
  • Van cover. If your work requires the use of any type of van, then you want to take out van insurance. This type of policy often includes cover for tools, as well as other benefits found in regular car insurance. It’s important to note that most car insurance policies don’t include business use, so it’s worth checking the small print even if you drive a non-commercial vehicle.
  • Business equipment and tool insurance. Your tools and equipment can be stolen or lost, or become damaged while you’re on a job. If your work relies on them, you’d want to get them fixed or replaced as soon as possible. This type of cover can help with that.
  • Personal accident. It’s not just other people or their property that are at risk, you may become injured too. Personal accident cover helps out with lost income, medical costs and hospitalisation benefit in case of serious injury or even death.
  • Legal expenses. While liability compensation payouts can run to millions, other costs involved in a court case can also cripple a business. Legal expenses cover helps to make the whole experience a little less daunting.
  • Business interruption insurance. Also known as business income insurance, it covers loss of income due to a disaster. This policy will pay out for instances such as the closing of the business facility (including while it’s being rebuilt). Note that this does not cover you for loss of income caused by the actions or circumstances of a partner company, even if it’s critical to your work.
  • Own/hired-in plant. If your work involves the use or lease of a piece of plant, this covers you against the risk of the plant being stolen or damaged.
  • Contract works cover. This type of insurance is specific to the construction industry and covers the cost of repairing or redoing work due to instances such as flood or fire damage, as well as damage to a third party.

If you have your own registered office or keep your tools and business equipment at dedicated premises (including somewhere in your home), you might consider taking out business buildings and contents insurance, which covers you for damage, theft and loss of property used for your business.

How much cover do I need?

You can get tradesman insurance with different levels of cover, depending on the requirements of your work or business:

  • Number of staff employed. Many tradesman and tradeswomen work as sole traders, but some do employ staff or apprentices. If you have people working for you, you are legally required to take out employer’s liability cover.
  • The cost of your projects. If you regularly work with high-level clients or on large-scale projects, you want to make sure you take out sufficient cover for liability, public indemnity and legal expenses.
  • Industry. If you work in a dangerous industry or handle hazardous materials, you should consider taking out higher levels of personal accident cover.
  • The tools and equipment used. If your work requires specialised or expensive tools or machinery, you want to make sure these are covered for damage, loss and theft.
  • Optional extras. Depending on your profession, you might choose to tailor your policy to your needs with extra cover like extra tools cover, jury service cover, efficacy cover or income protection.

It is important to get a number of quotes and talk to a variety of insurers before committing to any particular policy.

No one is perfect, and mistakes and accidents can and will happen. However, there are ways in which you can reduce your risk of complaints:

  • Make sure you agree on everything in writing with your clients, particularly where design or building work is involved.
  • Get your clients’ approval in writing on any changes and amendments.
  • Be honest and realistic about what you can achieve and to what timescales.
  • Have clear policy guidelines regarding inclusions and exclusions and communicate them to your clients.
  • Keep your clients and members of the public safe and away from hazards.
  • Keep all spaces clear to avoid accidents.
  • If you have employees, make sure you provide them with all the tools and safety equipment they require to complete their tasks.

Common claims examples

  • Flood damage. You can be an excellent plumber with years of experience, but a faulty fitting can undo your hard work and cause a pipe to flood a client’s home. Tradesman insurance will cover you for any legal action the client may take against you.
  • Items falling off walls. We all make mistakes sometimes, and a kitchen cupboard, shelf or even window you’ve installed in a client’s home can come loose and fall. This becomes much worse if it causes injury to someone. Taking out liability insurance covers you for this.
  • Break-in or theft of tools. Unfortunately, valuable equipment and tools can be stolen from your premises, vehicle or even the job site. Taking out cover for this makes sure you can get back to work quickly.
  • Accidents and injuries on the job. It’s not just other people and their property that can suffer damage. Some trades carry a personal risk with them, and so personal accident cover, as well as income protection, can protect you should you be hurt on the job, especially if it means you are unable to work for a while. If you have staff, it’s important to protect them too. Employers’ liability cover can take care of that.

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