What insurance is needed for builders?

If you work in the construction industry, whether as a self-employed bricklayer or in a small building business, it’s important that you have the right insurance. However, there are many types of insurance available, so it is worth understanding what builders specifically may need to consider.

Does it matter how my business is set up?

You will need to understand which insurance covers you want whether you operate as a limited company, a partnership, or are self-employed. The only real difference may be how much it will cost. Your premium will be a little more if you employ others instead of working on your own for example.

What insurance do I need?

There are different types you will may need in different circumstances. These include:

• employers’ liability insurance
• public liability insurance
• professional indemnity insurance
• insurance for your tools

When do I need employers’ liability insurance?

You are legally required to have employers’ liability insurance if you employ anyone, even if it is on a part-time basis or as a trainee.

This insurance will protect your business if a current or former employee suffers injury or develops an illness as a result of working for you.

If you do not have the required insurance, you can be fined £2,500 per day.

Why do I need public liability insurance?

You may want to consider this insurance if you are likely to come into contact with the public or clients while working.

You may find that larger clients require you to have public liability insurance as part of your contract and won’t work with you if you don’t have it. Similarly, your trade association may insist you have this kind of insurance to join.

Public liability insurance is important because it is designed to protect you if someone suffers an injury or you damage their property because of your work. It can cover everything from minor incidents to life-threatening injury.

It’s worth noting that these types of claims are common. A court order to pay costs could result in you having to pay thousands of pounds or more.

What is professional indemnity insurance for?

Professional indemnity insurance is designed to protect against the consequences of giving poor professional advice. For example, you might advise a client about design or specifications that turn out to be faulty.

Professional indemnity insurance will protect you if the client decides to sue you because of the faulty advice.

Do I need to insure my tools?

If you lose your tools, you may be unable to complete projects. In turn, this can cause cashflow problems which may make it difficult to find the money to replace your tools.

By having insurance for your tools, you have the peace of mind that they will be replaced quickly so you can get back to work.