When working as a contractor on one-off projects, it may seem simple to skip insurance. However, there are risks involved. In some cases, clients expect the right contractor insurance, or it may be required by law.
We explain when contractors need insurance. We also discuss which types of coverage are necessary. Even short-term work can benefit from having protection.
Why Contractors Might Need Insurance for Single Projects
Even on small one-off projects, things can go wrong. Examples include:
- Causing damage to property
- Accidental injury to others
- Making a mistake that costs a client money
If a claim arises, having contractor insurance could cover the cost of legal fees, compensation, or repairs. It also helps protect your business reputation by showing clients you take risk management seriously.
When Insurance May Be a Legal Requirement
In the UK, some types of cover may be needed by law, including:
- Employers’ Liability Insurance: If contractors employ others on a project, this insurance is designed to help protect against injury or illness claims from staff. It may be a legal requirement even for short-term work.
For other insurances like public liability insurance or professional indemnity insurance cover, there is no blanket legal rule. However, clients may ask for proof of cover before allowing work to begin.
Which Contractor Insurances Are Often Required?
The following insurance offers strong financial protection for one-off projects:
Public Liability Insurance
This protects against claims if a member of the public is hurt, or property is damaged due to your work. Many clients expect contractors to have this as standard.
Professional Indemnity Insurance
If your work involves giving advice or providing a professional service, this could help cover professional negligence or mistakes. Even a single project could lead to a claim if a client suffers a financial loss.
Tools and Equipment Insurance
Useful if you rely on tools to complete the job. This insurance can cover loss, theft, or damage.
Personal Accident Insurance
For sole traders, this helps provide income if you cannot work due to injury.
What Level of Cover Might Be Suitable?
The amount of cover depends on:
- Contract size and value
- Project risk level
- Client requirements
We recommend checking contract terms. Many clients specify minimum level of cover amounts for both public liability insurance and professional indemnity insurance.
Why Arrange Insurance Even for Short-Term Work?
While some contractors see insurance as an ongoing business cost, arranging cover on a per-project basis could:
- Help win client contracts
- Provide peace of mind for unexpected events
- Ensure you are not personally responsible for legal actions or large bills
Working with a broker helps ensure the correct type of cover is arranged, whether for a one-off job or regular contract work.
How We Help Contractors Find the Right Insurance
We support contractors by helping arrange tailored insurance options that match their project size, work type, and legal responsibilities. Whether for limited companies or sole traders, we help find the right professional indemnity insurance cover, public liability insurance, and more.