The tradie’s guide to business insurance

Why do Tradies need insurance?

Unless you’ve got a money tree growing out the back, the financial consequences of a claim could not only put you out of business but jeopardise your personal finances too. Business insurance has your back when things don’t quite go plan.

As a Tradie, it can even be a contractual requirement that you have certain insurance in place well before picking up the tools and putting boots on site. Always check the level of cover that is required, as there are different limits available.

Let’s take a look at some of the risks a Tradie may choose to cover with different types of business insurance.

Third-party injury or property damage

Despite our best efforts, sometimes accidents happen. If someone slips and is injured on your business premises or a client’s property is damaged while you are working, you could be legally liable for compensation and legal costs. That’s why Public Liability is considered essential cover for many trades businesses.

Public Liability insurance covers legal fees and compensation costs if a customer, member of the public, or a supplier claims against you for injury or damage to their property as a result of your alleged negligent business activity.

Faults or defects in your products

If you manufacture or sell products, you have a responsibility to your customers to ensure they are safe to use. This includes ensuring the product is safely designed, every production batch of product is consistent, and providing accurate warnings, instructions, and labels.

Product Liability insurance protects your business against claims by third parties relating to property damage or personal injury caused by your products. Product Liability insurance usually forms part of a Public Liability policy, and the word ‘product’ will be a defined term in the policy wording.

Damaged or lost tools

Your tools, specialised equipment and stock are essential to running your business. But what if you suddenly didn’t have them? Replacing them could become a long and expensive effort.

Portable Equipment insurance (also known as General Property insurance) covers you for loss and damage to items of portable equipment associated with your business. These can include repairing or replacing tools of trade and items of stock.

Illness or injury leaving you unable to work

Accidents happen, and a simple spot of home DIY or a weekend footy game could leave you unable to work for weeks or months. If being out of action is a no-go for your business, you may want to consider Personal Accident & Illness insurance to protect your most important business asset – yourself!

Personal Accident & Illness insurance provides a weekly income benefit following an accidental injury or illness once signed off from work by a medical practitioner for a set amount of time.

Legal allegations from your employees

If you have employees, they are likely a vital part of your business. But hiring doesn’t come without its own risks; allegations of workplace defamation, discrimination, harassment, or unfair dismissal from your employees could result in a lengthy and expensive legal battle.

Employment Practices Liability (EPL) insurance is designed to help employers minimise the risk and potential cost of claims taken against them by employees. Covered claims may relate to allegations of discrimination, unfair dismissal and sexual or workplace harassment.

Making a mistake

No matter how long you’ve been in business for, mistakes happen even with the most professional operators, one slip-up and you could be facing allegations of giving negligent advice, breaching your professional duty, defamation, or infringing on your client’s confidentiality. These allegations can result in a lengthy and expensive legal process; this is where Professional Indemnity insurance can have you covered.

Professional Indemnity insurance is designed for professionals who provide a specialist service or advice, giving protection for financial loss and legal costs in the event of a claim. This claim may be a result of an actual or alleged negligent act, error, or omission whilst providing your professional service or advice.

Professional Indemnity insurance is particularly important for Builders working in NSW, as under the Design and Building Practitioner Act 2020 registered building practitioners in NSW are required to have Professional Indemnity insurance to work in the state. Builders from other states and territories may also need a Professional Indemnity policy if they are working on projects in NSW.

Who needs Tradies liability insurance?

There are so many different risks your trades business can face, and they vary depending on the trade you are in. From builders to bricklayers, you can customise your cover to suit the risks and needs of your business.

Do sole traders need insurance?

Even if you operate as a sole-trader, many of these risks can still apply to your business. The impacts of these risks may even be greater, as all the responsibility falls on you to keep business moving and cash flowing.

Is insurance mandatory for Tradies?

While businesses insurance isn’t a legal requirement under the Australian government, there are still many circumstances where you many find yourself required to have some for of business insurance. Certain clients of worksite may have insurance requirements for anyone working on them, you may also be required to have insurance to join industry bodies or associations. And depending on where you live and the type of work your business does, you may have additional insurance requirements in order to maintain your licencing which allows you to perform your work legally; for example, Electricians operating in Queensland are required to have a minimum of $5million in Public Liability cover.

Sorting out your business insurance shouldn’t be a hassle and at BizCover, our goal is to make insurance easy. Jump online or give us a call, provide a few details about your business to receive multiple quotes from some of Australia’s leading insurers in minutes.