Do You Need Public Liability Insurance? | Checkatrade
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Do you need public liability insurance?

Once you’ve taken the first steps to start your own business, you’ll need to protect it. Having the right insurance is so important, especially public liability insurance.

If you’re setting up a limited company or setting up a new startup, you’ll want to know more about public liability insurance. So let’s explore what it is and whether it’s needed for a trade business.

What is public liability insurance?

Public liability insurance (PLI) is designed for businesses that work around members of the public. This makes it handy for any tradesperson who owns their own business.

It’s also a form of cover that protects you against legal and financial action from former customers.

Regardless of how small any previous mistakes or negligence has been on your part, your business will need insurance.

So do you need public liability insurance?

Yes. Having this form of insurance means any mistakes you make that affect a member of the public are covered.

Especially because PLI protects you against legal and financial action filed by former customers.

And getting public liability insurance can help to pay for legal expenses and any compensation if you lose your court case.

This prevents a small accident from drastically affecting your business. It is why it is essential for all Checkatrade members.

Register as a self employed or sole trade business

Do you need public liability insurance if you’re self-employed?

Even if you’re self-employed, you’ll need the correct insurance.

Think about it this way. If an accident happens at work that injures someone or damages the property, could you cope with paying out for it?

If your company couldn’t survive this, this cover is a must-have. It could even save you or your business from financial ruin!

So, think about how much insurance you need. And consider how risky your work is. This should help you decide how much PLI to take out.

For guidance, most types will cover you for between £1 million and £10 million.

What does public liability insurance cover for a tradesperson?

PLI is one of the most important types of insurance for most businesses.

It is crucial for all new, self-employed tradespeople. It’s so important tradespeople get the right insurance to protect their company.

So, this type of cover definitely can’t, and shouldn’t, be ignored.

Public liability insurance covers:

  • If your ladder accidentally falls on a homeowner, pedestrian or contractor
  • If you accidentally cause damage to someone’s property when doing work. For example, spilling paint on a carpet or knocking over a vase
  • Poor quality work and negligence

How much does public liability insurance cost?

The cost of PLI will depend on a range of different factors.

Cover can vary from insurance provider to insurance provider. Estimations online indicate that in 2024 that the average cost of PLI for businesses is £118.

This is based on the average business having around 2 employees. And a £2 million limit of Public Liability.

However, be aware that Checkatrade members can get PLI for less. You could save up to 20% with us. Log in to our Member’s Area and take a look at the latest deals from our partners.

How do insurers decide how much to charge?

When you inquire about different types of insurance, the insurance company will decide how much to charge you.

Public liability insurance costs are based on the following:

The size of your company

The larger your company and the more employees it has, the higher your premiums will be.

The type of business you own

Different businesses need different levels of insurance coverage.

How much cover you need

If you’re working with valuable materials and tools, or in expensive areas, your PLI might cost more.

Whether you’ve made insurance claims in the past

Insurers always look at your claim history. This gives them an idea of how likely you are to make another claim. As, past claims can increase your premiums.

On the other hand, a claim-free period before the inception of cover can result in a no-claims discount being applied.

How risky your work is

If the work you carry out is high-risk, you’ll usually need to pay more for public liability insurance. This applies to jobs like roofing, plumbing, or groundwork, for example.

Public liability insurance cost examples

As we mentioned above, the amount you pay for PLI will vary. It all depends on your circumstances and the insurer you choose.

The below table from the NimbleFins website covers the average UK prices for different levels of insurance:

Amount of public liability insuranceAverage UK cost
£1 million£106
£2 million£118
£5 million£140

Public liability insurance cost for small business

Smaller businesses generally take on smaller, less risky jobs. And this can impact the cost of insurance.

Public liability insurance cost for a sole trader or partnership

Limited companies aren’t the only businesses that need insurance.

As a sole trader or partnership, this insurance is vital to protect your business.

Fortunately, the cost of PLI isn’t too high.

And depending on the trade you undertake, Checkatrade members can access cover from our insurance partners. Have a look at our Member’s Area to see what you could save.

Protect your business for less

Checkatrade members get off the cost of public liability insurance

Find out how

Is it essential to have public liability insurance as a self-employed tradesman?

It’s not a legal requirement to have it, but it’s well worth having for protection and peace of mind. Also, it’s required by many trade associations.

If you work on commercial sites, you’ll likely need to provide proof you have it, too.

How to get the ball rolling

Many insurance providers have websites where you can easily sign up.

Or, if you’d prefer to speak to someone about your options, you can also call most providers.

It’s worth shopping around to find the best deals, and using a comparison site can help you when making your decision.

Do I need public liability insurance by law?

Surprisingly, no. It’s not illegal to not have public liability insurance. But, without this protection, you’re risking everything you’ve worked so hard to build.

And while you don’t need cover by law, some contracts and clients may require you to have this in place.

So you’ll be in breach of contract and at risk if you don’t have it.

Deciding to sign up for PLI is a choice you’ll need to make yourself, based on your circumstances.

Do I need public liability insurance as a sole trader?

Yes, sole traders need cover for peace of mind and security.

Sole traders aren’t treated separately from their businesses in the eyes of the law. And as a sole trader, you’re personally responsible for your business.

So, if a past customer sues you for any work you’ve completed, the payments will come out of your pocket.

Want to grow your business?

Our FREE e-book shows you how

Click here for access

Do subcontractors need public liability insurance?

It depends. As a subcontractor, you’ll usually work under the main contractor to complete a job.

Usually, the main contractor already has insurance that covers any work you do.

So, it’s always worth checking with the main contractor before paying out for your insurance policy.

  • Not all insurance policies are the same
  • If you’re covered under the main contractor’s policy, this may not cover every risk you encounter
  • It’s worth getting your insurance to protect for every eventuality

In addition, check your contract carefully as you may be required to arrange cover before starting work.

Do I need insurance as a contractor?

trader with public liability insurance

Plan to work at client sites or have an office that clients visit? Then you’ll need it to cover any injuries or damages that your work may cause.

Also, some clients may require you to have insurance before they agree to work with you.

And when hiring sub-contractors, you’ll need to cover them in case of accidents or damages.

Do I need insurance if I’m self-employed?

Self-employed tradespeople are at risk of being sued. This is because they can be sued by past clients for negligence, damages, or injuries and accidents caused by poor workmanship.

So, for security, you do need public liability insurance if you’re self-employed.

Don’t forget that your business will be at risk if a customer starts legal proceedings against you.

Plus, going through a court case is time-consuming. And a large payout could ruin your company if you’re personally liable.

Protect your business for less

Checkatrade members get off the cost of public liability insurance

Find out how

Public liability insurance FAQs

How much public liability insurance should I have?

There’s no straight answer. It depends on the following:

  • The type of work you do
  • How risky it is
  • How often you work around the public
  • The complexity of your job

Do individuals need public liability insurance?

Yes. If you’re a sole trader who comes into contact with the public, you must have PLI.

What is the difference between personal and public liability insurance?

Both are very similar, with one key difference:

  • Personal liability insurance covers individuals
  • Public liability insurance covers businesses

How can joining Checkatrade help my company?

Worried about the cost of taking out insurance? Just join Checkatrade to get a cheaper deal.

As a Checkatrade member, you’ll also have access to a unique profile page. Here, you can display your insurance and accreditations.

This is the perfect way to show new customers that you’re willing to go the extra mile.

Other exclusive Checkatrade benefits

Member discounts, flexible membership options, and a profile to show you’re a quality tradesperson.

You can customise your membership based on the amount of support you need.

Don’t just take our word for how good Checkatrade is, read one of our customer reviews.

Colin Jones from C Jones Home Improvements said:

“Since starting with Checkatrade at the beginning of my business, most of my work has been generated through the site. So I’m very pleased with the service and coverage.”

Useful public liability insurance checklist

  • Having insurance can protect you and your business legally and financially
  • It covers everything from accidents, injuries, and damages you may cause
  • You’ll need to decide how much cover your company needs when signing up
  • Most tradespeople, from sub-contractors to sole traders will benefit from having it
  • It’s not a legal requirement, but it’s extremely useful to have

Want to grow your business?

Our FREE e-book shows you how

Click here for access

Content disclaimer: This content has been created for general information purposes and should not be taken as formal advice. Read our full disclaimer here.

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