What is carpenters' insurance?
If you are a carpenter, you will need to consider which insurances to take out – whether you work on a self-employed basis or run your own limited company or partnership.
What does carpenters’ insurance include?
Carpenters’ insurance can mean different things to different people and insurance providers. However, it could include:
- employers’ liability insurance
- public liability insurance
- professional indemnity insurance
- insurance for tools
When do I need employers’ liability insurance?
You will need this if you employ anyone, as it is a legal requirement. You can be fined £2,500 a day if you don’t have it. You will also need it if you have any trainees or apprentices, volunteers, part-time workers, or even for some sub-contractors.
You should always check with your insurance company if you are in any doubt about whether you need employers’ liability insurance.
Do I need public liability insurance?
Although it is not a legal requirement, many larger clients and public sector organisations may require you to have it as a term of their contract.
It protects your business if something you do causes harm or injury to someone or damages their property.
If you are found responsible for causing damage or injury, and you don’t have insurance, you could find yourself paying thousands or hundreds of thousands of pounds in damages and legal fees. If you cannot pay, your business and assets may be at risk.
You may also find that some professional trade associations will not allow you to join unless you have public liability insurance.
Do I need professional indemnity insurance?
You will need to consider this if you provide professional advice as part of your work. For example, you may give formal guidance on design or specifications.
If that advice turns out to be negligent and causes financial loss or damage for a client, your professional indemnity insurance will cover you if they choose to sue.
Is insurance of my tools part of my carpenters’ insurance?
If your tools are stolen or damaged, it’s important that you can replace them as quickly as possible so that you can carry on working. As a result, tools insurance could be a part of your carpenters’ insurance considerations.
I am self-employed. How does this affect the insurance I need?
Your insurance premium may be slightly less if you are self-employed than if you operate as a limited company with employees for example.