Tradesperson insurance

As a tradesperson, customers rely on your skill, judgement and expert eye for detail. But in a job fraught with hazards, it pays to have a safety net in place just in case something goes wrong.

Whether you’re a builder, decorator, electrician or plumber – tradesperson insurance allows you to concentrate on what you do best…

Written by

David Edbrooke

Sub editor

Posted

15 DECEMBER 2021

6 min read

What is tradesperson insurance?

Tradesperson insurance is a type of business insurance that provides specialist cover for the risks faced by people working in the skilled trades sector.

Whether you accidentally damage a customer’s property or an employee gets injured on site, having the right insurance in place means you can keep working if the unexpected happens.

You can tailor your policy to include different types of cover you might need for your business, including public liability insurance and employers’ liability insurance.

Do I need tradesperson insurance?

This type of insurance is generally designed for tradespeople who work outside or at clients’ properties.

It can help protect a range of professionals, including builders, decorators, carpenters, joiners, electricians, plumbers, cleaners and IT contractors.

If you’re employed by someone else, you shouldn’t need to take out your own tradesperson insurance cover. But it’s worth reviewing the policy your employer has in place to check what it covers.

Examples of when tradesperson insurance is needed

Here’s a few scenarios where having tradesperson insurance could help if a claim is made against you:

You’re a builder working on scaffolding when your tools fall and damage a customer’s car.
You’re a decorator and accidentally spill paint on a customer’s carpet, which will need a professional clean.
A casual labourer breaks their leg after falling off a ladder and needs an operation plus time off work to recuperate.
You’re a construction project manager who advises your client to make major changes to a property that results in them suffering a financial loss.

Public liability insurance for tradespeople

Public liability insurance protects you against claims made because of property damage or injuries sustained by members of the public, connected with your work.

Perhaps you own a building yard or work exclusively at clients’ homes. All it takes is for someone to trip over your equipment and make an injury claim, and you’re facing a pay-out and legal fees.

Many companies will only offer work to contractors with this type of tradesperson insurance in place. It may also be a requirement for professional accreditation.

Employers’ liability insurance for tradespeople

If you run a business and employ other people, you’re legally required to have employers’ liability insurance and a displayed certificate to prove it.

This type of tradesperson insurance protects you if your employees are injured or become ill due to work. It could cover you if former employees make a claim for a condition they allege occurred from their time working for you.

It doesn’t matter if your staff are temporary, agency, apprentice, contract or unpaid – or whether you’re working on residential or commercial property. Failure to have employers’ liability insurance can result in a fine of up to £2,500 for each day uninsured.

The only potential exception is if you only employ family members, although, getting cover will still protect you against potential claims. However, if you're a limited company with multiple directors, you'll always be legally required to have employers' liability insurance.

Professional indemnity insurance for tradespeople

If you’re in the business of giving professional advice, professional indemnity insurance offers protection for your business and its reputation, should a client accuse you of offering damaging advice.

Perhaps you’re an electrician who certifies that some wiring was installed correctly, only for an unforeseen electrical fault to later cause a fire. This type of tradesperson insurance could cover the costs for damages or compensation claims against your advice, certification or design.

If you think professional indemnity insurance may be relevant to your business, remember you may need to extend the period of cover beyond the timeline of a contract. Doing so can help you to receive protection from any claims that might arise down the line.

What other tradesperson insurance might I need?

Depending on the type of business you run, you might also need:

Van insurance
As a tradesperson, your van is likely to be vital to your business. Van insurance can offer you protection if your van is stolen or involved in an accident.

Tool insurance
The tools of your trade need to be protected both at home and out and about, so make sure your van insurance and home insurance covers them. You can also buy tool insurance as part of your business insurance package.

Hired in and owned plant insurance
Plant insurance covers you for things like dumpers, diggers, forklifts, scissor lifts, cherry pickers and generators. It can cover you if the plant you own or have hired in gets stolen or damaged. Because of its nature, this kind of equipment carries its own risks and can be very expensive to buy or replace, so you may want to add this type of cover to your business insurance policy.

Contract works insurance
If your contracts make you responsible for partly completed work, then you’ll need contract works insurance. It covers you for construction work that’s been started but not yet finished. Imagine the situation where you’ve been working for weeks on a project, then fire sweeps through the site and you have to start all over again – at your own expense. Contract works insurance can offer you financial protection from such losses.

Stock insurance
Not only do thieves or vandals target tools and equipment, your valuable stock can also be attractive to them. With high prices for everything from copper piping to concrete, your cashflow could be hit hard if you had to replace your stock – not to mention it delaying completion of jobs. Just think of the value of your materials and consider if it’s worth adding this to your policy.

How can I reduce the risk of legal action?

Mistakes and accidents do happen. But there’s a few simple steps you can take to try to protect yourself:

Always make sure your client’s expectations are clear and agreed in writing, especially if you design or build for them.
Be honest about what can be achieved, breaking work down into set deliverables where possible.
Record all sign-offs in writing and log them safely.
Keep work areas as tidy as possible.
Keep clients and the public well away from dangerous areas when you’re working.

How much does tradesperson insurance cost?

Any insurance premium is based on a number of factors specific to you, like your claims history, size of your business and how much cover you need. The trade itself can also make a difference to how much you’ll pay because some professions carry more risk than others.

Get a tradesperson insurance quote now and see if you could save

Frequently asked guestions

What does contract works typically cover?

If the building work that you’ve started is damaged by a storm, fire, flood, theft or vandalism, you'll typically be covered for:

repair costs to work so far completed if it's been destroyed or damaged
labour, tools and materials needed to get your job back to where it was before the incident happened.

Will tool insurance cover all my equipment?

You can get specialist tool insurance that covers all your tools and equipment, including work laptops and smartphones. But make sure you don’t underestimate how much your tools are worth and read your policy terms carefully - some policies won’t protect tools that are left in a van or other vehicle overnight.

Can I add another trade to tradesperson insurance?

Yes, when you start a quote with us, we’ll let you add a secondary trade to your policy. For example, perhaps you’re a builder who also offers plumbing work. Making sure you have the right level of tradesperson insurance can be the difference between getting a claim paid and having to cover the cost yourself.