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Do Subcontractors Need Their Own Insurance?

Rhino Trade Insurance 14 February 2022

You may not be aware, but as a subcontractor, thinking you can rely on the main contractor's insurance can send you down a slippery slope. There is nothing worse than assuming you are covered when you could be liable should something go wrong on-site due to your work. 

Having the right level of Subcontractor Insurance in place is vital. Not only does it make sound business sense, but it also helps you sleep easy at night knowing you have a safety net in place. Even if the main contractor says they are sorting out all of the fine details, various liabilities may not be covered, so it's better to check before starting work on the job. 

Let's explain what insurance a Subcontractor will benefit from, what's included and the types of Subcontractor Insurance we offer. 

What is Subcontractors Insurance?

Subcontractor Insurance can cover a whole host of scenarios. The only thing better than finishing your work to a high standard and getting down the pub is being safe in the knowledge that you are covered with the right insurance. As you are a subcontractor that is highly skilled in several trades, your level of risk rises, meaning that having the right policy is imperative. That's where Rhino Trade Insurances comes to the party with our cocktail of excellent coverage options. 

What does Subcontractor Insurance include?

On a daily basis, we speak to hundreds of tradespeople up and down the country. What's good is that they share all of their experiences regarding subcontracting and what main issues crop up regarding insurance. 

Contractual requirements

Before you do anything, you must check out the contract from the main head honcho. Please don't pick up any tools until it's watertight. It will say who is responsible for sorting out Subcontractor Insurance and what exactly is needed. Don't just assume it's covered. 

A sticking point can occur if the main contractor asks for certain levels of protection and you cannot prove you have it. If you can't provide a valid piece of evidence that you are sufficiently covered to work on the site, the main contractor won't allow you on-site - thus resulting in you being out of pocket. 

Protecting yourself as a subcontractors

Even if you spot in your contract that the main contractor is insuring the project, they most likely won't be insuring you as a subcontractor for all the hazards and risks attached to your trade. 

Even if the main contractor has Public Liability Insurance, a claim could be made against the first company that the claimant sees - for example, if they see your works van, they might believe that you are responsible and claim against your business. It's not always straightforward to pass their claim onto the main contractor, and it could cause an unwanted headache for you.

What's more, the main contractors' insurance policies may not cover you for your possessions, tools, equipment or any machinery you hire for the work. And, if you hire anyone to work with you, Employers Liability Insurance will be needed. 

Types of Subcontractors Insurance

As an independent contractor, you should consider having the following insurance policies to make sure you are protected on-site:

Public Liability Insurance

The most popular form of Subcontractor Insurance in the UK is Public Liability Insurance. It specifically covers you for any damage, injury, or death caused on-site to a third party because of your work. Depending on your level of risk and business operations, you can choose the level of cover you need. With Rhino Trade Insurance, you can get cover from £1 million, £2 million, £5 million and £10 million on request. It also starts at just £6.07 a month! 

Employer's Liability Insurance

As stated above, if you hire any staff members and have them working with you on-site, they are under your direction/ jurisdiction. That mean's, by law, you must have Employer's Liability Insurance. This is in place to protect you or your business if a member of your team manages to damage property, injure themselves or die whilst undertaking work for you. 

For the bargain price of just £72.80 a year, you could save yourself a mountain of cash if something were to go wrong and you faced a claim. Just imagine, as a subcontractor, you are repairing some brickwork, and your worker falls off the ladder injuring themselves. This insurance will cover the cost of any claim you receive. 

Contractors All Risks Insurance

As a subcontractor working for a main contractor or project manager, the most fundamental reason you'd want Contractor's All Risks Insurance is to make sure that all ongoing work on-site is covered. That also means any on-site plant machinery or tools are covered, whether owned or hired. Depending on your level of cover, you can also cover for personal belongings, so it's well worth considering this one, especially when working as a subcontractor. 

Legal Expenses Insurance

Having Legal Expenses Insurance in place as a subcontractor will offer you financial protection for your business should it be confronted with any form of legal claim or dispute. 

When dealing with our friends in the trades, we've found that the most common types of legal issues arising are employment disagreements, criminal prosecutions and property disputes. Just imagine you are on-site and there's an accident. After some checks, it falls under Health and Safety legislation and means you could become the subject of criminal prosecution - in which you may need defending. That's when Legal Expenses gets to work and helps you out. 

Why do you need Subcontractors Insurance?

As we have stated throughout this post, if a general contractor wants you to work on-site, they will undoubtedly need you to have some level of cover. So unless you want to be sat at home, it's better to get yourself some Public Liability Insurance. That's not to say that is enough. But every subcontractor should have this insurance policy, to begin with. 

You could be a subcontractor working for a project manager and carrying out your work at height. If you or one of your team drops a piece of equipment and injures someone on-site or (god forbid) a member of the public, you could be liable for a claim. Having the right insurance in place will shield you from any potential financial disaster and keep you on the tools.

Why choose Rhino Trade Insurance? 

Rhino has built bridges with some of the best partners in the UK to design the best trade insurance policies on the market. We aren't here to bombard you with jargon and information. We want you to have the right level of cover for your business and be back on the job without any hassle. 

Our team is based right here in the UK and is available six days a week to talk about anything you want to know. Our number is 0116 243 7904. We also have a super-simple online quote form that doesn't ask for your life story. Get in touch now; we look forward to hearing from you.

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