5 Different Insurance You Can Acquire as a Tradesman

The trade and construction sector contains some of the highest risk occupations in Australia, with injuries and death happening regularly. Regardless of your trade, investing in the appropriate insurance cover is essential for protecting you or your business from different kinds of claims. Having the right cover allows you to focus on providing exemplary services, hedges you against financial loss, and protects your reputation.

Suppose you or your business were involved in an accident that resulted in a claim, how would you handle it? Do you have the appropriate tradesman insurance? Here is a guide on some of the best insurance for tradies to help you decide what works best for you.

1. Public Liability Insurance

Public liability insurance protects tradespeople against injury compensation and property damage claims by third parties. Arguably, this is the most vital type of cover tradespeople should get, considering the high-risk nature of the construction industry.

If a third party makes a claim against you, your public liability cover can handle the claim and pay the legal and compensation fees incurred. We recommend public liability insurance if you or your business frequently interacts with the general public and their property.

2. Commercial Vehicle Insurance

As a tradesman, you probably use your commercial vehicle for transport, to store your tools, and as a mobile office. Your commercial vehicle is arguably your most essential tool; if anything were to happen to it, you would become immobilized and consequently lose a massive chunk of your income.

The three most common types of commercial vehicle cover include:

  • Third-party only
  • Third-party fire and theft
  • Comprehensive

Besides these essential covers, you can include additional levels of cover like “Goods in Transit” as part of your commercial vehicle policy. Goods in Transit insurance can protect your valuable tools and equipment against theft and damage if you frequently use your commercial vehicle to store and transport.

3. Professional Indemnity Insurance

If you are a business owner, professional indemnity insurance can protect you against financial loss resulting from third party claims. This policy is particularly useful for businesses that provide design services or professional advice since it can assist with the legal fees and the claimant’s compensation fees.

Examples of instances where you may need professional indemnity insurance

  • If you are a builder and a client file a claim against you for making an error that causes them to suffer a financial loss

  • If you are a construction project manager and a client file a claim against you for advising them to make major changes to their property, resulting in a financial loss

4. Tool Insurance

As a self-employed tradesman or a construction business owner, you probably understand the value of your tools. Having the right tools gives you the capacity to handle more jobs and consequently increases your potential income.

While the risks your tools are exposed to varies depending on where you store them, tool insurance protects your tools and equipment against:

  • Accidental damage
  • Weather-related damage, e.g., storms, floods, and fire
  • Loss
  • Theft, vandalism, and malicious damage

Tool insurance protects the tools and equipment used on the job by repairing or replacing them when the insured peril occurs. Although a tool policy is not a legal requirement, many tradespeople find it crucial.

Note that this cover only applies to tools stored within the business premises. It does not apply when you are using your tools and when you take your tools off the business premises or keep them in a commercial vehicle. After all, storing your tools in a vehicle overnight is an invitation for theft.

5. CAR Insurance (Contractors All Risk)

CAR insurance protects your plant, tools, and equipment against potential loss, damage, or theft. It is essentially a more comprehensive tool cover since it includes a broader range of equipment, including those you hire for on-site use.

CAR insurance also covers temporary buildings like project plans, show home contents, and on-site houses. This policy can protect most of your construction assets from perils such as theft, vandalism, malicious damage, fire, storms, and floods. While a CAR policy is not a legal requirement, it could help you minimize the cost of replacing expensive tools and equipment.


Eric Reyes is a passionate thought leader having been featured in 50 distinguished online and offline platforms. His passion and knowledge in Finance and Business made him a sought after contributor providing valuable insights to his readers. You can find him reading a book and discussing current events in his spare time.

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