Business Tradesman Insurance - What are the Benefits?

Most tradesmen understand that in business you need to expect the unexpected, and whilst your biggest and most lucrative commission yet may be just around the corner, so might be the potential for bankruptcy. In order to help keep your business life stress free, it is crucial that from the word go you take out the correct business tradesman insurance policy. The benefits are significant as you are protecting yourself in the event that a disaster hits your business or claims are made against it, whether they arise from your employees, clients or members of the public.

There are many types of insurance policies available which are designed to suit the many different trades e.g. builder insurance or plumber insurance. By taking out business tradesman insurance for your trade you are buying protection in the event of a disaster affecting your business, including a claim being made against you by one of your clients or employees. The benefits are significant.

Whether you are a builder, painter, plumber, electrician or carpenter most good tradesman insurance policies can be tailored to suit your individual needs. Importantly though, regardless of whether you are self-employed or an employer, neglecting to set in place the appropriate tradesman insurance can be a recipe for disaster.

To start with you need to assess your businesses risk to help you secure the correct insurance policy. There are some legal requirements which determine the insurance cover you need as well as the particular needs of your own business.

So for example if you work as a builder you have a legal responsibility for the health and safety of your employees and customers. Once you employ someone, you are legally required to have employers liability insurance, which provides cover against claims made by employees for injuries or illnesses they may suffer as a result of working for you. As an employer you are at risk of being sued if an employee is injured as a result of your negligence or breach of duty. If their personal injury compensation claim is successful, you may also face a claim from the NHS for the costs of hospital treatment. So from the word go check that your business tradesman insurance covers your employers legal liability requirements, including cover for legal fees, costs and expenses such as representation at any coroner's inquest, fatal accident enquiry or other court hearing resulting from an accident.

Some trades, such as building, carry higher risks and therefore it is extremely important to ensure you have the right level of cover e.g. some policies offer an indemnity limit of up to £10 million, inclusive of legal costs.

In the modern world it also makes sense to take out public liability insurance. This covers damages and costs that may be incurred from death, injury or damage to property caused to members of the public by your business activities. It can also provide cover for events such as defective workmanship, professional negligence and damage to contract workers.

Outside of tradesman liability insurance, one of the most frequent types of business disaster is the damage to, or theft of, tools and equipment that are critical to the operation of your business. It goes without saying that tool insurance cover for your tools and equipment is an absolute need. You need to have such cover so that if, on waking up, you find that your tools have been taken from your store, in a very short time frame you can be back in business.

Whilst we started off considering the benefits of business tradesman insurance, in reality the downsides of not having this insurance are so great, and indeed illegal in respect of employers liability insurance, that it really is essential that you consider taking out this cover for your tradesman business.

(Ref: FP537)

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