What insurance do you need if you do manual work?
We break down the main types of tradesman insurance you may need as a tradesperson
Because of the nature of your job, it's really important to get the right cover for your business. If your tools are stolen, you could have to give up work. And if someone hurts themselves or a customer's property is damaged because of your business activities, you could be liable. Without the right tradesman insurance in place, you'll have to make up any costs out of your own pocket. Plus, some clients won't even hire you without the correct cover.
From plumbers to electricians, carpenters to gardeners, read on to find out what cover you need.
1. What tradesman insurance do I need if I work in people's homes or around members of the public?
The first cover you should think about is public liability insurance. This will cover you if you, or an employee, injures a member of the public or damages their property, as a result of your business activities.
For example, if you knocked a customer's expensive vase off a shelf or stained their carpet, public liability would cover the legal fees you would have to pay. It'd also cover you if a member of the public tripped over a toolbox and twisted their ankle.
If you have staff, you're legally required to have employers' liability cover, too. We'll go into more detail on that below. You might also want to consider tools and business equipment insurance, so you're covered if your ladder, vacuum cleaner or even pressure washers are stolen or damaged.
2. I work on construction sites most days. What insurance should I have?
Public liability, tools and business equipment and employers' liability cover mentioned above all apply to the construction site. But builders might also want to invest in stock and materials insurance. This covers the loss and damage of goods like pipes and bricks when they're on a site, in storage between jobs, or in transit.
For machinery that isn't covered by tools and business equipment, you can take out own plant or hired-in plant insurance. This includes mini diggers and generators.
3. What kind of insurance do I need to cover my employees?
If you have any employees - including casual workers or apprentices - you're legally required to have employers' liability insurance. It covers you if one of your team is injured or falls ill due to the work they do for you. For example, if an apprentice hurts themselves on-site because they haven't had the right training to use the tools they need, employers' liability would cover you.
4. Do I need employers' liability insurance if I only use labour-only contractors?
Yes. Labour-only contractors are very like employees, so you'll need employers' liability cover if you use them. That's because they work under your supervision, and they use materials and tools that you provide them with. You'll probably dictate their hours and where they work.
5. Do I need employers' liability insurance if I only use bona fide subcontractors?
You might work with bona fide contractors. These are more independent - like painting contractors that might help redecorate a house. So, they'll work without supervision and set their own hours. You don't need employers' liability for them. But it's worth checking that they're properly licenced and that they have their own public liability insurance before you hire them. If they have staff, they will need employers' liability insurance of their own.
Still confused? This handy article explains the difference between contractors in more depth. You can also call your insurer to check whether you need to cover a contractor on your policy.
6. Will tradesman's tool insurance cover my tools 24/7?
Tools and business equipment insurance will safeguard your gear. So, if you're a plumber it'll cover the cost of replacing your wrenches, pipe cutter and more if they are damaged for reasons other than wear and tear. Theft of tools is a concern for businesses especially from unattended vehicles. Our tools and business equipment insurance will cover theft from an unattended vehicle during the day as long as all points of access on the vehicle are securely locked. Your cover limit will depend on the size of your business.
See the option of 24-hour tools cover to have these items covered in your vehicle overnight below.
For after-hours insurance, you can add 24-hour tools cover, too. We offer a policy for tools you leave locked in a vehicle overnight. You'll just need to make sure that all doors and windows on your vehicle are locked, and any immobilisers and alarms fitted are set. You must also make sure that any keyless fobs are kept in a faraday pouch to protect yourself from thieves. And finally, that you empty your van if you're not using it for work for five consecutive days. There is a £10,000 limit per claim, and a £1,500 limit for a single item.
7. Biggest business liability insurance myths
The right insurance can keep you covered. But it's important to understand the ins and outs of your policy before you agree to anything. There are a few common misconceptions about what tradespeople need cover for, and what the policy includes.
For example, poor workmanship isn't covered as standard by public liability. So, if for example, a heating engineer installs a central heating system but doesn't seal the pipes properly and it causes a leak, public liability will not cover the costs to repair the central heating and pipes installed but should cover the resulting water damage to the property. If this is something you're worried about, check with your insurer before you take out your policy.
Another misconception is thinking that apprentices don't count as employees. Apprentices would be deemed as employees and it's a legal requirement for you to have insurance that covers them. If you're not sure if someone needs to be included in your cover, check the guidance from gov.uk.
8. What features should you look out for when taking out tradesman insurance?
When you sign up to a new policy, you're signing into a contract with that company. So, it's important that you check everything in the policy carefully.
Every business is different. So, you should make sure that your insurer lets you customise your policy with the right cover for your business. You should feel confident that you are covered for everything your business does but ask any questions you may have if you're unsure.
Finding a balance between price and reputation is important, too. Whilst most small businesses want to save money where they can, business insurance shouldn't be a corner to cut. Ensuring that you buy your insurance from a reputable company that covers all aspects of your business is vital so that should you need to make a claim both your business and your reputation are protected.
Something to think about when choosing an insurance company is whether they charge admin fees when making changes to your policy, sometimes this isn't a deal breaker for some, but if this is something important to you ensure you explore this beforehand. We let you make unlimited changes, without any fees.
You should also make sure you can get hold of your insurer seven days a week. You never know when the worst is going to happen. We offer a 24/7 legal helpline, so you can consult with a team of qualified legal advisors whenever you need to.
Learn more about the different types of insurance we offer for tradespeople here:
https://www.directlineforbusiness.co.uk/small-business-insurance/tradesman