Connor Campbell
Whether you’re a plumber, electrician or builder operating as a sole trader, or someone running their own small construction firm or decorating company, your business as a whole will be safer and more financially secure if you have tradesman insurance.
However, tradesman insurance is not one type of coverage, but rather a selection of policies, usually with public liability insurance at its core.
These policies will help cover you in the event of injury, death, property damage, theft or loss, and will pay any legal fees and compensation costs that arise from a claim.
Read on to find out more about what tradesman insurance covers, which policies you should consider, and how much it costs.
What insurance should a tradesman have?
Although the specific details will differ from policy to policy, tradesman insurance will normally cover:
- Compensation costs related to any claims, be that replacing your own tools or for injury or damage caused to a client’s person or property.
- The legal fees you may incur while defending the claim.
Below we take a look at some of the most common, and important, types of insurance for tradesmen to consider.
» MORE: Do I need business insurance?
Employers’ liability insurance
If you employ any fellow tradesmen for your small business, be that full-time, part-time, as a contractor or an apprentice, you are legally required to take out employers’ liability insurance covering you for at least £5 million.
This insurance will cover you if an employee is injured, or falls sick, due to the work they do for your business.
If your employees are solely family members, you do not need an employers’ liability policy.
» MORE: Employers’ liability insurance explained
Tradesman public liability insurance
While it is not a legal requirement, public liability insurance is heavily recommended for tradesmen, as it protects you in the event of injury or property damage to a customer, client or member of the public.
This would include accidents, such as a member of the public tripping over your equipment and breaking their arm, or smashing the wing mirror of a client’s car when bringing building materials into their home.
» MORE: Learn about public liability insurance
Personal accident insurance
Your employees and members of the public are not the only ones at risk while you are doing your job.
You as a tradesman are just as in danger of illness, injury or death caused at work. A personal accident insurance policy would compensate you if you are unable to work due to any of these reasons.
Tradesman tool insurance
As a tradesman, your tools are your livelihood. If you have tool insurance, it means the cost of replacing anything that is lost, stolen, damaged or destroyed will be covered by your policy.
Tool insurance policies tend to be either:
- Own plant, tools and equipment cover. This is for any tools and equipment you yourself own.
- Hired-in plant cover. This is for any tools or specialist equipment you might need to rent for your business.
Tradesman contract works insurance
This form of insurance is normally only needed by those who work on construction sites. This could be a site as big as a new housing development, or as small as building an extension.
Contract works insurance is designed to cover you as your work is being carried out. It applies in the event of damage caused by floods, fires, vandalism, theft and other accidents outside your control.
Tradesman professional indemnity insurance
Whether you need tradesman professional indemnity insurance depends on if you provide advice, designs and specifications as part of your business that could later cause a financial loss for your client. This includes claims of professional negligence.
» MORE: Everything you need to know about professional indemnity insurance
Builders insurance examples
If you are in the building and construction industry, there are many situations where some form of builders insurance would shield your business from financial hardship.
For example, if one of your employees broke their leg due to falling debris while knocking down a wall, the compensation they’d be owed would be covered by employers’ liability insurance.
Or if a client, customer or member of the public is injured walking past your worksite, builders public liability insurance would pay for your compensation costs and legal fees.
In the instance that a storm causes flooding on the new house build you are working on, a contract works insurance policy would cover the costs of replacing materials, tools and equipment to get the project back to the state it was prior to the flood.
And if you help design and build a wall that later developed structural issues due to your original specifications, professional indemnity insurance for builders would pay for the financial loss incurred by the client replacing it.
Electricians insurance examples
In an industry ripe with hazards, it is wise to take out a comprehensive set of electricians’ insurance policies.
If a client were to shock themselves on exposed wires left loose during a job, your electricians’ public liability insurance would cover the compensation they are due.
The same is true if an employee hurt themselves rewiring a kitchen – as long as you had an employers’ liability policy.
Were you to come back to your securely locked worksite from lunch to find your toolbox stolen, meanwhile, an own plant, tools and equipment insurance policy would cover the cost of replacing your items.
You would only need professional indemnity insurance as an electrician, however, if you give advice on, or provide specifications for, let’s say, how a house should best be rewired or electrical equipment should be installed.
Plumbers insurance examples
It is not hard to imagine the situations in which plumbers insurance would be of use.
All it takes is one poorly installed pipe to burst in a client’s home for a plumbers’ public liability insurance policy to be worth its premium.
Equally, the specialised tools used in the plumbing industry can be costly to replace. That’s why, if they were to break or be damaged during a job, tool insurance would pay for you to buy new ones.
And again, as with all trade professions, you would only need to consider plumbers’ professional indemnity insurance if you provide professional advice or specifications as part of your business. For example, how best to plumb a new bathroom.
How much does tradesman insurance cost?
As with all types of insurance, there are a range of factors that will affect the premium you end up paying. These include, but are not limited to:
- The number of policies you include in your tradesman insurance package.
- The level of coverage you select for each policy.
- The size of your business.
- Which line of work your business is in, and the unique risks attached.
- Where your business is based, and the kinds of locations you work at.
- Any previous claims you have made.
It is always wise to compare different insurers to make sure that you are getting the best deal for your business, with the necessary level of coverage.
Image source: Getty Images
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