Do I Need Public Liability Insurance as a Tradesperson?

A common question often asked by tradespeople is, do I need to have public liability insurance? There is no legal requirement to have public liability insurance. By not having though it can leave you or your company open to legal costs. Leaving you responsible for paying any compensation that might become payable following a claim against you or the company.

A large claim could leave you or your company with a large bill to pay. It may even bankrupt the company for a substantial claim.

Most homeowners or organisations will also only work with you if you have public liability insurance. So it's always best to operate with the insurance on cover. It gives you and your customers peace of mind that you're covered if anything should go wrong.

What is Public Liability Insurance?

Public liability insurance is an insurance product that helps protect you and your business for legal and compensation. These are costs that will become payable if a member of the public is injured on your business premises. It can also cover you against accidental damage to a client's property.

We encourage all homeowners to check if tradespeople have the required insurance before commencing work on their property, regardless of how small or large the job is. Without adequate insurance, their home is at risk and you are at risk. Small errors can lead to expensive repair jobs. Drilling a hole in a wall and accidentally bursting a pipe that leads to larger damage.

Do I need Public Liability Insurance If I Don't Have a Premises?

You might think that you only need public liability insurance if you have a business premise that clients or member of the public visit. This is not the case. If your business has any interaction with a member of the public, it's still advised to have public liability insurance.

As a tradesperson, public liability insurance would cover you against causing accidental damage to a client's property. Always check with your policy provider to confirm cover.

What it doesn't cover is damage to yourself or to any employees. In order to insure against that you will need to have employer's liability insurance.

Why Do I Need Public Liability Insurance?

As a builder, you are responsible for the structure of the building, but also any chemicals or tools that cause accidental damage to a client's property. Even leaving a nail on a floor and a client stepping on it can lead to serious injuries.

Plumbers or electricians work that could accidentally lead to flooding or fire. Maybe you're a painter or decorator and you drop paint on the carpet or accidentally damage something else with paint.

Whichever trade you work in there is always a risk. This is why insurance exists. It gives you and your customers peace of mind that you are covered should anything go wrong.

If you are planning to win larger contract work, you will only be awarded the work in many cases if you have public liability insurance above a certain level. You'd need to confirm this with the potential client, as each one will have minimal requirements.

What Public Liability Insurance Doesn't Cover

While it can change from one policy to the next on what is and isn't covered with regards to levels (always check with your insurance broker). There are some items that are not covered, and you will need separate insurance.

Employees are not covered for any injury while on the premises, as this will be covered under employer's liability insurance. You are required by law to have employer's liability insurance.

Damage caused to your own property is not covered. This includes damage by employees or members of the public. This kind of damage would be covered under your business insurance.

Check your excess levels. Lower premiums might sound better at the time of renewal, but not at the cost of a highly inflated excess. Excess is the amount that you as a business will be required to pay in the event of a claim. E.g. if you have a claim for £10,000 and an excess of £4,000, you will only be paid £6,000. The £4,000 would be payable by your or your business.

Buying Public Liability Insurance

You can buy public liability insurance from most insurance companies. You may get a discount if you take out all your insurance with one company, but it's always best to shop around. Direct Line, Compare the Market, Go Compare and Hiscox and Axa are to name but a few names that you may be familiar with.

Always check what the policy covers and doesn't cover. This should be confirmed before you agree to accept the cover. It's always best to compare cover from different providers to make sure that it does cover you where needed. Cheaper insurance isn't always the best option, as it may not cover you for something you need cover for.

Also, check that it covers your trade and if there are any specific limitations for your trade. This should be clearly presented to you by your insurance company. If in doubt, check with them to clarify legal wording.

It's also worth asking fellow tradespeople who they insure with. Ask if they have ever had to have a claim and how it was handled.

Other Insurance to Consider