Even the most careful tradies can have an accident or lose their tools. Whatever size the project, whether you’re a handyman, plumber, builder, carpenter or electrician, being properly insured can bring real peace of mind to you, your clients and your employees. When it comes to insurance for tradies, making sure you have the right cover can ensure you minimise the risks and associated costs.
For some tradies, public liability insurance is mandatory, and most building contracts above a certain value require this cover.
Compulsory or not, it always makes absolute sense. If you accidentally cause injury to someone or damage property, you could be liable for damages and significant financial loss. Costs could include medical and rehabilitation expenses, repairs and/or legal fees.
It can also be harder to find work if you aren’t insured. Some customers want to know they’ll be compensated if something goes wrong.
You can’t work without your tools. If they’re stolen from a worksite, a storage shed or the back of your truck, the right tool insurance can help you replace them allowing you to return and get on with the job.
Your ute, truck or wagon is another business essential. You might be tempted to save a few dollars by not mentioning to your insurer that you use the vehicle for work, but you run the risk of having a claim rejected if it relates to your job.
Some policies include accessories and modifications such as your signage, racks and tow bar when they’re assessing the vehicle’s replacement value.
They may also have more flexibility in terms of the number of drivers covered – this is important if your team shares the driving.
Worksites can be hazardous, exposing tradies to dangers such as incomplete electrics, working at height, noise and manual handling. And, of course, anyone can become too ill to work. When you work for yourself and don’t have sick leave, you have the extra worry of no income.
Income protection insurance can help bring the security of an income if injury or illness stops you from working for an extended period. Some trades insurance policies include an income protection option, or you can purchase standalone cover.
The ideal scenario for any tradie is to avoid accidents altogether. The Australian Bureau of Statistics’ report for the 2021/22 financial year highlights some of the most important ways to stay safe.
1. Handle with care
Lifting, pushing, pulling or bending accounted for almost a quarter (24%) of the accidents reported. Safe lifting techniques and using mechanical aids wherever possible can help to reduce the strain.
2. Keep tidy
Slipping and tripping accounted for 17% of injuries. Keeping your workplace free from trailing wires, cables, hoses and spills could help make them safer.
3. Keep a look out
A lot is going on at a worksite and it’s important to stay aware of your surroundings. At 16% bumping into or being hit or cut by an object or vehicle was the third most common type of accident.
When your livelihood is at stake you may not be able to afford to make mistakes. Your AIB insurance broker can help you explore our Trades insurance packages and tailor the protection you need.
Important note
This article does not take into account your specific objectives, financial situation or needs. It is also not financial advice, nor complete, so please think about whether these types of insurance are appropriate for you. Deductibles, exclusions and limits apply. You should consider the Product Disclosure Statement or any Target Market Determination in deciding whether to buy or renew these types of insurance. Various insurers issue these types of insurance and cover can differ between insurers.
Steadfast Group Ltd ACN 073 659 677
There are lots of reasons to be a sole trader – to simplify your business or if you’re just starting out are some of the common ones.
Maybe you’re an artist or graphic designer working from home. Perhaps you’ve got a side hustle as a florist. Or you could be a gardener with a thriving local business.
In fact, sole traders are the most common of all businesses, with research by the Australian Small Business and Family Enterprise Ombudsman (ASBFEO) showing 61 per cent of all Aussie businesses are sole traders.
Sole traders are people who carry on business under their own name and not through a company or trust.
If you decide this is the right structure for you, it’s important to ensure you also have the right insurance cover for your business.
Which insurances are compulsory?
Steadfast Group broker technical manager Michael White says the spectrum of insurance cover required will depend on the nature of the business the sole trader is conducting.
“If they own a building, they should insure the building. If they don’t own the building and they’re tenants, they need to ensure their contents. If they own a building, they need public liability insurance. Tradespeople going out to work on building sites need public liability insurance. If they own a motor vehicle, they need motor vehicle insurance.”
Even if you are a sole trader, every business with staff must have workers’ compensation insurance. You may also need to take out public liability and professional indemnity insurance.
This type of insurance can provide a safety net when staff are injured or unwell as a result of their work.
Workers’ compensation insurance is managed by the states and territories and each state and territory has a regulatory authority that looks after this area. Check your state or territory’s authority’s website to find out more about this insurance.
This type of cover can protect businesses when their actions have been negligent and caused injury or death to a third party.
It means if the business is sued as a result of its actions, it can have the resources to respond to any legal actions and the means to pay any damages.
It may still be appropriate to hold public liability insurance if your business currently has no or limited revenue, or if you are working from home. But your exposures are likely to have changed. So it’s an idea to talk to your insurance broker to ensure the cover you hold remains appropriate to your needs.
Professional protection
Professional indemnity insurance can provide cover for businesses that offer professional services from the legal costs and claims for damages from an act, omission or breach of duty that happens as a result of their actions.
Sole trader insurance options
As a sole trader, it’s also important to consider taking out either income protection insurance or personal accident insurance. These insurances can help protect you if you fall ill or have an accident and you are unable to work for a period. It’s also a really good idea to have health insurance.
There is a range of other insurances to consider as a sole trader. If you are a tradesperson, you may wish to take out specialist insurance that covers tradies. You will also need to have the right insurance to cover theft of your tools.
It’s an idea to talk to your AIB insurance broker to that no matter how you structure your business, you have the right cover to protect you from the common risks you face.
