From electricians and plumbers, to carpenters, builders and every specialism in between, tradespeople form an important part of the UK workforce.
As a busy tradesperson working in different environments, the risk of being involved in an accident can be high. That’s why it’s important to have the right protection in place.
In this guide, we’ll take a look at the types of insurance you might need as a tradesperson, and the things you should consider before choosing a policy.
Why is insurance needed for tradespeople?
When it comes to protecting yourself at work, there’s a lot to think about.
An accident could cause damage to your vehicle and your property, but it could also cause personal injuries that stop you from working.
There’s the risk of causing injuries to others, damaging a client's property, and the potential legal claims that follow. And then there’s the chance that your tools and equipment could be lost or stolen.
Insurance is a safety net that protects you from these things and more.
Whether it’s protecting your work van with comprehensive commercial van insurance, or making sure you have personal accident cover in place, choosing the right insurance can be critical to your success as a tradesperson.
What types of insurance do tradespeople need?
Here are just a few of the different insurance types you might need as a tradesperson:
- Public liability insurance
- Personal accident cover
- Professional indemnity insurance
- Business van insurance
- Personal belongings and tools in transit cover
Of course, there are other types of protection to consider. Depending on your personal situation and whether you employ others, you might also need employers' liability insurance, income protection or critical illness cover.
The types of insurance we list in this article are only intended as a guide. Before deciding what type of cover you need, we always recommend getting advice from an insurance or business advisor.
What is public liability insurance?
Public liability insurance protects you in case you accidentally injure someone or cause damage to their property while you’re working.
If a claim is made against you, this type of insurance covers you for any legal claims or compensation payouts.
For example, let’s say you're working in someone’s house and you accidentally spill a can of paint or varnish on a valuable carpet. Public liability insurance would cover the costs if you were to get sued by the homeowner.
How important is professional indemnity insurance?
Professional indemnity insurance covers you if you're accused of professional negligence, of making a mistake, or of giving bad advice which leads to a client losing money. It’s an important type of cover for anyone who provides advice or a professional service.
For instance, if an electrician's faulty wiring leads to an electrical fire, this insurance can protect against any claims or financial compensation.
Is employers' liability insurance needed for tradespeople?
If you employ staff, even just occasionally, employers' liability insurance becomes a legal requirement. This insurance covers the cost of compensation claims arising from employee illness, or if an employee is injured while working for you.
So, if you’re planning to hire someone to help with an upcoming project, you’ll need to consider this type of insurance before you go ahead.
What about tools and equipment insurance?
For many tradespeople, their tools and equipment can be their lifeline. Without them, they may not be able to work.
Tools and equipment insurance covers the cost of replacing or repairing your tools if they’re lost, stolen or damaged.
So, if your van is targeted by thieves and your tools are stored in the back, this insurance will help you to replace them quickly, meaning you can get on with your job.
Do tradespeople need personal accident insurance?
If you're injured in an accident and left unable to work, personal accident insurance will provide you with a source of income while you recover.
For tradespeople working in challenging or potentially dangerous environments, this type of cover can provide peace of mind and a financial safety net when they need it.
Should tradespeople consider vehicle insurance?
If you’re using a van or other light goods vehicle to carry out your work, you’ll need a business van insurance policy. This is a legal requirement in the UK.
This type of motor insurance is different from the policy you use for personal driving (known as social, domestic and pleasure, or SD&P insurance). SD&P usually only covers the everyday use of your van, like driving to the shops or visiting friends.
Business van insurance covers vehicles that are used for work or commercial reasons, such as transporting tools, goods or equipment to various job sites.
What about income protection insurance?
Income protection insurance isn’t a legal requirement, but it can be useful for some tradespeople. It provides a regular income if you're unable to work due to illness or injury.
It can provide peace of mind for self-employed tradespeople who don't have the benefit of employer-provided sick pay.
Why should tradespeople consider life and critical illness cover?
Life insurance and critical illness cover can provide financial security for your family or dependants. It offers a financial safety net for your loved ones if you die, or if you’re diagnosed with a critical illness.
While it’s not a nice thing to think about, you may want to consider this type of insurance in case the worst happens.
What insurance do I need as a sole trader in the UK?
As a sole trader in the UK, you’ll most likely need public liability insurance, which protects you if you accidentally injure someone or damage their property while working.
However, it's important to consider other types of insurance as well, since a single policy rarely covers all potential risks.
Depending on the work you do and the risks you’re exposed to, you might also need to consider professional indemnity, tool and equipment, and personal accident insurance.
Speaking with an insurance professional or business advisor will help you to choose the right level of protection for your business.
How to choose the right insurance for your trade business
Choosing insurance for your trade business depends on a few things. These include the type of work you do, the size of your business, the vehicles and equipment you use, and the specific risks you’re exposed to.
Aswell as meeting legal requirements, choosing insurance is also about peace of mind. With the right level of cover, you can ensure that you, your employees, your equipment, and your livelihood are protected against the unexpected.
Before deciding what cover you need, we recommend speaking with an insurance broker or business advisor, who can provide tailored advice based on your own situation.