Inside Insurance by ManningUK – What You Should Know About Contractors Insurance

Many medium-sized businesses work with contractors either on specific occasions or as a more permanent arrangement. Either way, it’s important to be familiar with the specific requirements that govern the business relationship between companies and independent contractors.

Determining whether you need additional insurance is one of those requirements. In most cases, self-employed contractors aren’t covered by the employer’s liability insurance, whereas contractors employed by an agency may be covered by that agency’s policy. If you have decision-making power over your company’s financial matters, you’ll want to know how to get the appropriate level of cover and make good use of your business resources.

In this article we’ll discuss what you need to know about contractor’s insurance.

What is contractor insurance?
This is a type of insurance that offers coverage against claims over property damage and injury to contractors or to third parties by contractors working on your behalf. With this type of cover, your business is protected from the exorbitant costs that could arise because of work-related accidents. Therefore, contractors insurance can safeguard your assets and provide business continuity.

Who needs contractor insurance?
Trades professionals like carpenters, builders, electricians, plumbers, painters, HVAC installers, landscapers, as well as construction workers and handymen. Generally speaking, this type of insurance is required if the work performed entails some risk to property or individuals, such as logistics/driving work, and construction industry contracting. However, not all trades carry the same risk level, so not all contractors need the same level of cover. A freelance PA working in your office, for instance, is deemed a lower risk than a self-employed crane operator on a building site.

What is the contractor’s all risk insurance?
Contractor’s all risk insurance is a non-standard insurance policy that offers comprehensive cover against third-party injury and damage claims. This type of insurance is common in the construction and trades sectors, where the risks and costs of claims could be substantial.

Some of the common aspects of a project covered by contractor’s all risk insurance include:

• Public and product liability: Offers cover against claims of damage or injury that may affect the public or third parties.
• Contract works: Protects work that is already underway and helps cover the costs of rebuilding or redoing a project affected by vandalism, fire, floods, theft, etc.
• Employee tools: Covers tools, clothing, and movable equipment used by contractors.
• Plant and equipment (both hired and your own): Covers a wide range of assets (scaffolding, forklifts, generators, etc) and covers the cost of replacing them in the event of theft or damage.

Special considerations
The most important advantages of contractor’s all risk insurance is that it’s comprehensive and flexible. If your project has special insurance requirements that aren’t covered by standard insurance, contractor’s all risk insurance offers the peace of mind you need.

The coverage levels of contractor’s all risk insurance can be extended to cover additional aspects of a project, including:

• The interests of a main contractor.
• Damage to neighbouring property that can’t be attributed to negligence.
• Debris removal.
• Business interruption.

Next steps

If you need support when choosing contractor’s insurance, at ManningUK we can help you find a tailor-made policy at the most competitive prices.