Running a limited company as a contractor brings flexibility and opportunity, but it also comes with risks. Having the right limited company insurance can protect the business and its team from mistakes and injury claims.
We explain the main types of contractor insurance cover and how they apply to freelancers and small teams across the UK.
Why Contractors Might Need Limited Company Insurance
Even one-person companies can face legal actions or insurance claims. Having tailored insurance cover could help with:
- Protecting against client claims
- Meeting client contract requirements
- Covering the cost of defending professional negligence claims
- Offering peace of mind when running projects
For small teams, protecting employees and business equipment may also be important.
Key Types of Cover for Contractor Limited Companies
Professional Indemnity Insurance
If your company offers a professional service like advice, design, or consultancy, professional indemnity insurance cover is essential. It can cover claims if a client says your work caused them financial loss.
Professional indemnity insurance is designed to cover:
- Professional mistakes
- Bad advice or designs
- Data loss or breach of confidentiality
- Defamation linked to services
- Clients may ask for this type of cover in contracts.
Public Liability Insurance
If you visit clients or work in public places, public liability insurance can help protect you. It covers injury or damage claims made by others. This cover applies to accidents that happen while you are carrying out your work.
Employers’ Liability Insurance
If your limited company employs staff, including part-time or freelance workers, employers’ liability insurance may be a legal requirement. It covers injury or illness claims from employees while they are working.
Directors and Officers Insurance
Company directors may face personal liability for business decisions. Directors and officers insurance can help cover legal actions and investigation costs linked to management choices.
Tools and Equipment Insurance
Contractors often rely on specialist tools or IT equipment. Business contents insurance or tools and equipment cover can protect against theft, loss, or accidental damage.
How Much Cover Might Contractors Need?
The right amount of cover depends on:
- The size of the company
- The value of projects handled
- Client contract requirements
- How much business equipment is owned
We help contractors arrange insurance with the correct level of cover to suit their work and team size.
Why Combine Policies Through a Broker?
Many contractors arrange combined policies to save time and keep things simple. A broker can help by:
- Reviewing risks linked to your professional service
- Suggesting suitable insurance offers from trusted providers
- Helping with policy documents if a claim arises
With the right support, contractors can cover a wide range of risks without overpaying.