How to pick the right tradesperson insurance

It’s worth making sure you’ve got the cover you need, as having the right tradesperson insurance will be an essential lifeline for your business when things go wrong.

So, keep reading to learn everything you need to know in finding the right insurance for your trade business.

What to look for in small business insurance

What insurance do you need? It’ll depend on the type of work your business does. It’s also influenced by the number of employees you have and the type of properties you’re working on.

In other words, insurance that’s perfect for a solo tradesperson working on domestic properties may not be sufficient for a trades business. Especially if you have multiple employees, and you’re in commercial buildings.

There are different types of cover within a business policy. Understanding each of these, and how they apply to your business, can help you select the level of cover you need.

Here are some scenarios along with the insurance types you’ll need to cover you:

Cover that protects you if an employee claims compensation

This is called Employer’s Liability Insurance.

If your business has employees, then you are legally required to have Employer’s Liability Insurance.

If an employee claims compensation for an injury – and it’s believed that you as the employer are liable for this – then you will be covered by Employer’s Liability.

Do I need public liability insurance as a sole trader?

Sole traders aren’t treated separately from their businesses in the eyes of the law. This means that if a past customer sues you for any work you’ve completed, you’ll need to make any payments out of your own pocket.

As a sole trader, you are personally responsible for your business.

Sole traders do need personal liability insurance cover for peace of mind and security.

Replacing lost or damaged tools

You’ll need tradesperson tools insurance.

You will need this insurance to replace lost or damaged tools. Replacing lost or damaged tools is an enormous investment for a business.

Cover for this is essential. It can also be extended to cover tools that are stolen from an unattended vehicle.

Cover for things that are lost or damaged when they’re being transported

This is Goods in Transit cover. It means you’re covered if your tools, property or goods are damaged or lost when being transported.

Cover for working on site

This is Contract Work Cover. It’s for work that’s underway on site.

It can cover costs to repair or redo work that is in progress and damaged by things like theft, vandalism, fire or flood.

Cover for your plant equipment

This is Own Plant Cover. This cover is for larger items of machinery and equipment that you own.

Cover for hired equipment

This is Hired in Plant Cover. This is for larger items of machinery and equipment that you’ve hired.

Finding the correct insurer for your trades business

Decided what types of cover you need? Good. Now you’ll also need to pick an insurer that’s right for you.

Even with identical cover, the right company will make life a lot easier if you do need to claim.

Tips to find the right insurance company

• Take a look at their financial stability
• Any customer service awards
• Their areas of expertise

An insurer that specialises in motor may not be the best placed to support a small business.

A business, however, with years of experience supporting tradespeople will likely have more knowledge to help guide you through any claim you make.

Checkatrade members save 20% on specialist insurance

3 common mistakes to avoid when taking out small business insurance

1. Make sure you use your legal trading name

If your business is limited, then the policy should be in the company name. If you’re a sole trader or a partnership, then the policy should be in the names of the individuals.

2. Read the small print

With insurance, the devil really is in the detail. The exclusions are all the specific scenarios that your insurance won’t cover. So read them all carefully.

If you have any questions, ask for clarification.

3. Continuous cover is a safe bet

You will always be notified when your insurance needs to be renewed.

But we all know running a business is hectic and things can be missed.

If you have continuous cover, your insurance will automatically renew for the next year.

And you should be able to opt-out of automatic renewals as easily as you can opt-in. It makes things easy if your situation changes.

Our recommended insurance partner for our members

We’ve teamed up with Covéa Insurance to make sure our members and their business are covered.

Covéa offers insurance at exclusive rates for Checkatrade members. This includes Public Liability Insurance as standard. It also offers:

• Employer’s Liability cover
• Goods in transit cover, and
• Tool covers

…as options.

In other words, you’ve come to the right place if you’re looking for tradesperson liability insurance!

Find out more

For more information on public liability insurance for self-employed tradespeople, check out our public liability insurance blog.