Public Liability Insurance for Tradesmen

Whether you’re a builder, carpenter, decorator, electrician, plumber or handyman, you’ll probably have learned your trade over many months and years.

Your customers rely on your skills as an expert to design, make or repair for them. When things go well, you’ll leave a happy or relieved customer. However, your occupation is fraught with hazard, and in the event that something goes wrong, it’s important to make sure that you’ve got the right level of insurance cover in place.

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What insurance might you need?

First up, whether you personally need insurance will depend if you are a sole trader or employed by a company. If you’re employed by someone it’s worth reviewing the policy they have in place first to see what it covers. 

If you’re a sole trader, partnership or own a limited company, take decisions, responsibility and profits from the business you run, there are three types of liability insurance you should consider.

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Public Liability Insurance

Public Liability Insurance is a useful cover for any tradesman. It protects your business from claims that may arise as a result of accidental damage or injury that a customer or a member of the public suffers in connection with work you carried out.

No matter if you have a building yard, where you invite customers to discuss a project, or work at your client’s premises, if they simply trip over your equipment, hurt themselves and decide to make a claim against you, your public liability insurance could help to cover your legal fees and compensation should you be asked to pay it out.

Even a tiny mistake could turn into a costly accident, hence many companies require contractors to have a certain level of Public Liability cover, without which they wouldn’t be offered the job. What’s more, if you are a member of a professional body or hold professional accreditation, having public liability insurance in place is likely to be your membership requirement as well.

The cover limit usually ranges from £1million and can rise up to £20million or more. Your insurance premiums will differ depending on the nature of your business and what level of protection you decide to take out.

Employers’ Liability Insurance

Employers’ liability insurance is mandatory if you run a business and employ staff – no matter how many, on what basis (temporary, agency, apprentice, contract or unpaid) or where you work from (home or from commercial property). Only owners of companies, where they are the only employees and own 50% or more of the business are exempt from requiring this insurance.

The Employer’s Liability insurance protects you against claims if your employees become injured or ill due to work – whether it happens on or off site. Beware that even former employees could make a claim against you for illness or injury that occurred as a result of their employment with you

The minimum level of employer’s liability cover you need is £5million, however, the majority of insurance providers offer a minimum limit of £10m for any one claim. You are also required by law to display a copy of your Employer’s Liability Certificate of Insurance where your employees can easily read it Failure to display the Certificate can result a fine of £1000 from the Health & Safety Executive (HSE). Failure to have Employer’s Liability insurance could lead to a fine of up to £2,500 for every day you don't have this insurance in place

Professional Indemnity Insurance

This insurance will be especially important for you if you give professional advice, certify or design for a fee but do not carry out work or supply goods needed to fulfill these services yourself.

In other words, Professional Liability will cover your business if your clients accuse you of giving wrong advice that led them to financial losses.

For example, if you are an electrician and certify that wiring was installed correctly, but there is an electrical fault that causes subsequent fire and burns down a building where the wiring was. Your Professional Indemnity insurance will cover costs from damages or compensation claims against the work.

Professional Indemnity cover is not relevant to all businesses. If you need to take it out, however, remember you will be covered against claims made against you during the period of time your cover is valid. To ensure you are protected from claims arising a few years later, your contract may require you to purchase Professional Indemnity insurance for a period of time after the completion of your contract. This can include a number of years and you should check contracts carefully.

What should you do?

Your first step should be to try and limit problems in the first place. We know this sounds obvious and mistakes and accidents can and do happen. That said, there are some things you can do in your business that help to reduce the risk of legal action.

If you design or build for your customers, always make sure your clients expectations are clear and agreed in writing.

A well written specification agreed between the two parties is key. Be honest about what can be achieved and what can’t. If possible on larger jobs, break the deliverable down into pieces that can be separately signed off by the client – and record these sign offs in writing.

Keep work areas as neat and tidy as possible and keep your customer or members of the public away from any hazardous areas when you’re working.

Finally, make sure you take out insurance cover to make sure you and your business is protected. Not only might this make sound commercial sense but it will also give you some valuable peace of mind.

Compare prices

Finding competitive liability insurance isn’t complicated. In fact, you can do it right here, right now. Use our Public Liability comparison services to find the right deal for you. Protect your business with liability insurance. Compare with us today.