Risk is part and parcel of being a tradie. Injuries and accidents happen, and we all know there’s no controlling the weather. That’s why it’s important to get insured sooner rather than later. In this article, we cover everything Australian tradies need to know about business insurance.
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Short on time? Skip ahead!
- 1. The best types of insurance for trade business owners
- 2. Isn't all tradie insurance mandatory in Australia?
- 3. Optional cover for extra peace of mind
- 4. How exposed is your business?
- 5. Best insurance providers
- 6. How to find the best insurance policy for your business
- 7. Future confidence
1. The best types of insurance for trade business owners
After a long week on the tools, the last thing you want to worry about is a big, unexpected expense. At the very least, it helps to protect your hard work with some basic insurance.
Here are the four most useful types of insurance for tradies:
Public liability insurance
Public liability insurance is crucial for a tradie business. It deals with any claim made by third parties like clients or neighbours. It covers things like slips, delays, damage to property, or injuries caused by work. For example, if a worksite hazard causes someone to hurt themselves, the injured party can insist you cover the cost of their medical treatment.
Public liability insurance will help cover the legal costs of defending against these claims. If they’re found to be legitimate, your insurance should cover all the costs. It’s especially good for small businesses or sole traders as these costs can get steep.
Tools and equipment insurance
Your tools are critical to the success of your business, not to mention massively expensive to replace. If they’re lost, stolen, or damaged, tool and equipment insurance means you can replace them quickly, without having to fork out. It also covers the cost of renting equipment if there's a wait to get replacements.
Income protection insurance
You can purchase income protection as an individual tradie or your employer might offer it as a work benefit. If you get injured or fall ill, it will match your income until you can return to work. That’s extra important when you’re starting out and don’t have any savings to fall back on.
Workers’ compensation insurance
When employees get injured or sick while on the job, workers’ compensation insurance covers their expenses while they recover. This includes medical costs, lost wages, and disability benefits. In the case of workplace death, it can also compensate the employee’s dependents.
2. Isn’t all tradie insurance mandatory in Australia?
Public liability insurance is only mandatory for electricians and plumbers in Australia. However, workers’ compensation insurance is required in all states if your business has employees. Other than that, the kinds of insurance you get are your choice. It's up to you to protect your future, so having the basics is a smart move towards protecting your business and your employees.
For more ways to reduce your risk, here are some tips to get the most out of site inspections.
3. Optional cover for extra peace of mind
For a good night’s sleep, here are some other insurances that’ll lower your risk even further:
Business expense insurance
If you can’t work due to injury or illness, you won’t have to stress about paying any business-related expenses.
Vehicle insurance
Vehicle insurance covers your trucks, vans, or cars against damage or theft.
Contract works insurance
For construction already underway on a building site, this covers you for things like flood, fire, and vandalism.
4. How exposed is your business?
Working out your level of risk depends on the type of work you do, how you do it and if you have any backup savings. For example, self-employed sole traders are personally liable for any debts or legal claims against their business, but subcontractors who have less control over projects can carry the risk of someone else's mistake.
If you have employees, it’s important to make sure everyone feels safe on-site. Do you know how your team feel about the health & safety protocols in your business? Send them our free Health & Safety Survey Questions to find out.
To identify high-risk activities on-site, use the Tradify digital form template to fill in your Safe Work Method Statement (SWMS).
5. Best insurance providers
To nail down the right insurance product for you and your trade business, compare tradie insurance packages and costs — and always read the fine print.
Here are some of the top insurance providers offering tailored tradie insurance:
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Allianz - With tailored insurance products for carpenters, electricians, plumbers and builders, Allianz is an excellent choice for tradies. As a long-standing provider, its reputation serves it well.
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CGU - Offering public liability insurance, tools and equipment, and commercial motor insurance, CGU can help protect your business.
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AAMI - AAMI tradie insurance packages include public liability, tools and equipment, and commercial motor insurance.
6. How to find the best insurance policy for your business
It’s time to get yourself covered. Start by comparing quotes from a few providers. Look at the cost differences, read the policy details and understand what’s not included. Speaking with an insurance broker can be a swift way to find the best deal for your trade business.
7. Future confidence
Being a tradie is all about the go-go-go, and insurance can often be left in the dust. Without insurance, you’re responsible for cleaning up after accidents and even weather events entirely out of your control. Investing now will give you more confidence in your day-to-day as well as strengthen and protect the future of your business.
To learn more about why business insurance is so important for tradies, read our insurance guide.
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