Builders are exposed to many business and safety risks on the work site. It is for this reason that it is important that they have the right insurance coverage structured according to their needs. In this guide, we will look at some of the essential insurance policies for builders.
What insurance is required by a builder?
Builders require several types of insurance coverage. The first one is the builder’s public liability insurance, and this offers protection against third-party injuries on the property. For example, if a passer-by is injured by falling debris, the builder will be covered by this insurance. Public liability insurance also protects you in case of damage to other people’s property.
Builders also need employer’s liability insurance. This is a legal requirement in the UK for limited companies. It covers the cost of compensating employees who become ill or injured as a result of carrying out work on the property.
All-risk insurance policies are very important as well. They cover all causes of damage to the work in progress. These include floods, fires, and storms. Any cause that isn’t explicitly omitted in the policy will be covered by the insurance company.
Another essential insurance for builders is the professional indemnity policy. This policy isn’t required by the government, but your contractor may have contractual conditions that include the purchase of this insurance. It covers you in case a client makes allegations of professional negligence.
Smaller builders also need to purchase tools and equipment cover. This will ensure that the project isn’t delayed because of damage to or theft of tools and equipment.
New home warranties are also very important for builders and homeowners. These policies are concerned with the structural integrity of the building. This means the fixtures and fittings won’t be included in the cover.
Do you need insurance to be a builder?
Builders who have other people working under them are legally required to take out employer’s liability insurance. Note that the law makes an exception for builders who employ their immediate family members. Such builders won’t have to buy this insurance policy. Other insurance covers are good to have and may be required by the contractor. However, they aren’t a legal requirement.
What insurance does a self-employed builder need?
Self-employed builders should consider buying the following insurance policies:
- Public liability insurance
- Product liability insurance
- Tools and equipment insurance
- Goods in transit insurance
- Employer liability insurance
- Contractors all risk insurance
Self-employed builders may not have the financial capacity to get through unexpected events like the loss of tools, so insurance covers are very important.
How much is builders insurance UK?
Builders insurance packages in the UK include various types of covers. These include employers liability insurance, public liability insurance, and products liability insurance. The cost of the policy will vary depending on the type of properties you work on, how long you have been in business, and the presence or absence of employees. The cheapest policy you can get will cost you around £60, but it is important that you choose the right cover, tailored to your individual needs, and cheaper is not always better.
