Do I Need Trade Insurance?

For anyone working in the trades and services industry, there is a possibility that you will need some form of insurance. But how do you know which one you need?

Different trade workers will require different forms of insurance for different reasons. In this article we will look at some of the reasons why you may or may not need trade insurance.

Before we go any further, we will first take a look at exactly what trade insurance is.

What is Trade Insurance?

Trade insurance isn’t one single form of insurance. Instead it is a range of different covers which fall under the trade insurance banner.

One of the most common forms of insurance for tradesmen is public liability. This form of insurance protects you and your business financially is you cause property damage or personal injury to another person.

Tool insurance is also very popular, as is income protection insurance which can replace the majority of your usual earnings if you cannot work due to illness or injury for a period of time.

Essentially the role of trade insurance is to protect tradesmen from a range of different risks. Some of the policies are designed to protect your business, whilst some are designed to protect your personally.

A trade insurance package will generally include a range of covers such as those listed above. You can find more detailed information on each of these covers by following the links on our website.

Who Needs It?

Virtually all tradesmen could benefit from some form of insurance, but when it comes down to whether or not you actually need trade insurance it depends on the type of trade you do as well as the structure of your business.

Generally speaking, those most commonly needing trade insurance will be tradies who are self-employed or working as subcontractors.

Tradies will be required to have insurance based on either government regulations or worksite regulations, or sometimes a combination of both.

Government Regulations

Some Australian states have special requirements when it comes to public liability insurance.

Electricians in Queensland and Tasmania for example must hold a public liability policy, as must plumbers in Victoria.

Furthermore, some tradesmen will also need a special type of insurance known as consumer protection insurance. This mainly affects Qld electricians and Victorian plumbers.

There are no government requirements when it comes to income protection insurance and tool insurance, but that doesn’t mean they aren’t a good idea for any tradesman.

Worksite Regulations

The majority tradesmen needing insurance will do so because of worksite and building company regulations which affect their contractors and subcontractors.

Many worksites and building companies have mandatory public liability and income protection requirements for all self-employed tradies and subcontractors. Without insurance they will not allow you on site.

If your worksite does have mandatory insurance requirements, you will generally be required to provide a copy of your certificate of currency to the building company or site manager.

Taking Out Cover

If you have been told that you need trade insurance, the first step is to start obtaining quotes from the various insurance companies.

The cost of insurance for tradesmen can vary greatly depending on the insurer you choose, so it is definitely worthwhile taking the time to shop around.

You can contact each of the insurance companies separately for quotes, however a better option may be to use an insurance broker who can obtain quotes from multiple Australian insurance companies.

A specialist tradesman insurance broker will be able to assist you not only with finding the best premiums, but also in finding the right cover that is going to suit you and your business.