Contractor working on a roof structure

What insurance do contractors need?

06 June 2018

Having the right contractor insurance not only demonstrates professionalism but also your care and commitment to keeping your clients property safe. Whether you're a plumber, a joiner, or a handyman, you could be staking a huge financial wager by not having the right cover in place.

So what are the most important covers to consider as a contractor? And how would they protect you if something unexpected happened?

Public liability insurance ensures that you're protected against accidental damage to customers' property and can also protect you financially against claims for third party injuries deemed to be caused by you or your business.

Employers' liability insurance is required by law if you hire staff, even if they are part time or temporary. Site workers can be at greater risk of accidents due to the nature of the work they do, particularly when working with plant and machinery. Having this cover in place can protect your business against the financial exposure of personal injury claimed from employees; insurers usually offer £10M protection as standard.

You will need Employers’ Liability if you have an apprentice, or even if you have a volunteer who works for your business. The only exemption to this is if the employee is closely related to the owner and the business is not a limited company.  Even so, it would still be prudent to purchase Employers Liability insurance to cover yourself and your business.

Contract works is an insurance cover that can help to protect work in progress at the site that you have been working on. As construction work can often take place over a series of days, months or sometimes years, there is a chance that something could happen to the works, materials or equipment on the site which could cause losses for your company. This could be a fire, flood or vandalism that potentially destroys the work already completed.
You’re probably reliant on a number of tools – handheld, power tools or equipment that you use daily. Depending on the nature of your work, these could be quite costly and hard to replace. If your business equipment is of any value then you need tool insurance to protect it against the unexpected. Theft of tools can be particularly common; especially when left in commercial vehicles overnight. This cover can often be added to your insurance policy, subject to some security conditions.
Being self-employed comes with many perks; but one of the downsides is that you are responsible for your own absence and sick pay. One or two days off may not have much of a financial impact, but if you broke a limb leaving you sofa bound for a few weeks, your income could take quite a hit. Personal accident cover as part of your contractor insurance can offer a set amount to substitute your weekly income in the event of an injury. So if you’re a roofer or builder working on site or in any other high risk trade such as window cleaning, you should consider including this cover in your contractor insurance policy.
As careful as you may be, accidents happen and things can go wrong along the way. If you’re taken to court, legal costs in defending yourself could rapidly rise. Commercial legal protection could take care of these costs, and can also protect you against a number of other scenarios as well. For instance, if you’re subject to a tax or VAT investigation, these costs could be covered by your legal protection insurance. It can also help to protect you against employment disputes and commercial tenancy disputes as well.
If you’re an electrician or tradesman in general, you may be providing designs or advice to your customer in your professional capacity. Should your customer suffer a financial loss, they could claim against you for your loss, which could be covered by Professional indemnity insurance
Most contractors will use a van daily to get to and from work and carry their equipment. Whatever work you do, if you use your van for business purposes then you need commercial vehicle insurance to protect you on the road.
Premierline can help you arrange insurance to protect you against a number of risks. You can compare contractors insurance quotes online. If your needs are more complex, consider contractors all risks insurance. Our agents are on hand over the phone to provide advice and recommendations on all your commercial insurance needs.
It is important to make sure that you have the right insurance in place to protect the business that you have built. Every business is different and has its own business insurance needs, which is why we work with some of the UK’s most well-known insurers to ensure that you are getting the right insurance cover for your business.
The information and tools contained in this guide are of a general informational nature and should not be relied upon as being suitable for any specific set of circumstances. We have used reasonable endeavours to ensure the accuracy and completeness of the contents but the information and tools do not constitute professional advice and must not be relied upon as such. To the extent permitted by law, we do not accept responsibility for any loss which may arise from reliance on the information or tools in our Insight Hub.
Joe Bloggs
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