What types of insurance does a tradesman need?

Public liability insurance

As a tradesman, you need to have public liability insurance in place to protect yourself from claims should a member of the public be injured or their property damaged as a result of your negligence.

For example, if you’re a plumber and you leave a hosepipe lying around on a nature strip and a pedestrian trips over it, you could be liable for their injuries. Or if you’re a painter and you spill paint on a customer’s carpet, you could be liable for the cost of having the carpet cleaned or replaced.

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Public liability insurance can protect you from these sorts of claims, as well as claims for compensation and legal costs. Most insurers will offer cover of up to $10 million, although you can usually choose to increase this if you need.

Income protection insurance

Income protection insurance is a type of insurance that can help you to cover your living expenses if you’re unable to work due to an injury or illness. It can provide you with a replacement income of up to 75% of your pre-tax earnings, up to a maximum of $10,000 per month. Some insurers will offer higher limits.

Income protection insurance can be an important safety net for tradesmen, as it can help you to meet your financial obligations even if you’re unable to work.

It’s worth noting that most income protection policies have a waiting period of between four and six weeks, so it’s important to have some savings set aside to cover you during this time.

Tools and equipment insurance

Tools and equipment insurance is a type of insurance that can cover the cost of repairing or replacing your tools if they’re lost, stolen or damaged.

For example, if your tools are stolen from your ute, or if your laptop is damaged in a fire, tools and equipment insurance can help you to cover the cost of repairing or replacing them.

Most insurers will cover the value of your tools up to $10,000, although you can usually choose to increase this if you require.

It’s worth noting that most tools and equipment policies have a excess of around $500, so it’s important to factor this in when you’re choosing a policy..

Business motor vehicle insurance

If you use your vehicle for business purposes, you need to make sure you have business motor vehicle insurance in place. Business motor vehicle insurance is similar to standard comprehensive car insurance, but it also provides cover for business-related activities, such as courier or delivery work.

It’s important to note that business motor vehicle insurance doesn’t cover you for your business equipment, such as tools or laptops. For this, you need to take out tools and equipment insurance.

Course of construction insurance

If you’re a builder, you need to have course of construction insurance in place to protect your works in progress. Course of construction insurance provides cover for loss or damage to buildings or other structures that are under construction.

For example, if your works are damaged by a fire or severe weather, course of construction insurance can help you to cover the cost of repairs.

Most insurers will cover the value of your work up to $5 million, although you can usually choose to increase this depending on your needs

Test and tag insurance

If you’re a tradesman who works with electrical equipment, you need to make sure you have test and tag insurance in place.

Test and tag insurance provides cover for the cost of repairing or replacing electrical equipment that has been damaged by a power surge, short circuit or other electrical faults. It also covers the cost of having your equipment tested and tagged by a qualified electrician.

Most insurers will cover the value of your equipment up to $10,000, although you can usually choose to increase this if you require a higher cover.

To wrap things up

As a tradesman in Australia, you need to make sure you have the right insurance in place to protect yourself, your family and your livelihood. There are a number of different types of insurance that you need to consider, including public liability insurance, income protection insurance and tools of trade insurance. You also need to make sure you have the right insurance for your vehicle, whether it’s a commercial vehicle or a ute. And if you’re a builder operating a construction site, you need to have builder’s contract works insurance in place. In this article, we’ve looked at the different types of insurance that you need to consider as a tradesman in Australia. Make sure you have the right cover in place to protect yourself, your family and your livelihood.

Published: Sunday, 9th Oct 2022
Author: Paige Estritori