Tradie insurance: the covers tradies actually need
Tradie insurance isn't a single policy. It's a package built around public liability, which head contractors, builders and many clients insist on before you start work, plus cover for your tools and equipment, your ute or van, workers compensation once you employ anyone (including an apprentice), and some form of income cover for you, because workers comp doesn't cover a sole trader's own injuries.
Only some of it is compulsory: CTP on a registered vehicle, workers compensation when you have workers, home warranty insurance for residential building work in the states that require it, and public liability for certain occupations in some states. The rest is optional in law but often required in practice, so the useful question is which covers your contracts, your clients and your own finances demand.
By Better Rate Mate Editorial Team · Last reviewed
General advice only. It doesn't consider your circumstances. Read the PDS and TMD before you decide.
What's in a tradie insurance package
Insurers sell these as a bundle or separately. The table shows what each cover is for, whether it is compulsory, and who usually needs it.
| Cover | What it pays for | Compulsory? | Who typically needs it |
|---|---|---|---|
| Public liability | Injury to other people and damage to their property caused by your work | Not by law in most cases, but usually a contract or site condition | Every tradie working on other people's property or sites |
| Products liability (completed work) | Injury or damage caused by work or goods after you have left the job | No | Plumbers, electricians, installers; usually bundled with public liability |
| Tools and portable equipment | Theft of or damage to tools and equipment, on site, in transit and at home | No | Anyone whose tools would be expensive to replace in a hurry |
| Commercial motor vehicle | Damage to your ute, van or truck and to other people's vehicles and property | No, but CTP is compulsory with registration | Anyone using a vehicle for work; business use must be declared |
| Workers compensation | Your workers' wages and medical costs after a work injury | Yes, once you employ workers (state rules) | Tradies with employees or apprentices, and some who use subcontractors |
| Personal accident and illness, or income protection | A benefit for you if injury or illness stops you working | No | Sole traders and working owners, who are not covered by workers comp |
| Contract works | Damage to the building work itself during construction | Sometimes a contract condition | Builders and trades carrying the risk of the works |
| Home warranty insurance | Protects homeowners if residential building work is defective or incomplete | Yes, for residential work in states that require it | Licensed builders and trade contractors doing residential jobs |
| Professional indemnity | Claims that your design, advice or certification caused a loss | Not for most trades | Trades that design systems or give paid advice |
Public liability insurance for tradies
Public liability is the core of tradie insurance. For most tradies, public liability insurance is the cover you'll be asked to prove before you're let on a site. Builders and head contractors commonly write a minimum limit into their subcontract agreements, often $10 million or $20 million, and ask for a certificate of currency showing the policy is active. Some also ask to be noted on your policy as an interested party, or for a principal's indemnity extension that lets the policy respond to claims against them arising from your work.
Read the exclusions that bite on trade work. Common ones include damage to property you are working on (sometimes called care, custody and control), the cost of fixing your own faulty workmanship, work above a set height or below a set depth, hot work such as welding and cutting without precautions, damage to underground services, and anything involving asbestos. If your trade regularly involves any of these, look for a policy that covers it, or at least check its exclusion wording and any conditions.
How much public liability cover do tradies need: $5m, $10m or $20m?
Usually whatever the person you're working for says. Head contractors and builders write a minimum public liability limit into their subcontracts, councils set one in their permit conditions, and commercial clients put one in their supplier terms. $10 million and $20 million are the common figures, and you'll be asked for a certificate of currency showing it. The City of Melbourne, for example, requires at least $20 million for a single claim when you hold a permit for an activity in its public spaces.
If nobody sets a figure, base it on the worst realistic claim your trade could cause, not on the cheapest premium: serious injury claims can run to millions, and anything above your limit is yours to pay. The limit is the most the insurer pays for one occurrence, not the price, and the premium doesn't double when the limit does. Get quotes at each limit with the same excess to see the real difference. What $10 million or $20 million of cover means explains how limits, aggregates and defence costs work.
What tradie public liability won't pay for
Public liability pays for injury to other people and damage to their property. The gaps that catch tradies are mostly about your own work, your own property and you. One insurer's current business PDS (GIO Business Protect, prepared 28 March 2024) shows the typical wording:
- Your own faulty workmanship. The policy excludes the cost of performing, completing, correcting or improving your work, although injury or damage to other property that results from faulty workmanship is still covered.
- Property in your care, custody or control. Damage to property you own, lease or rent, or that is in your physical or legal control (such as the item you're working on), is excluded unless the policy adds limited cover back.
- Injury to you or your employees. Your workers are covered by workers compensation; you, as a sole trader, need personal accident and illness or income protection.
- Your tools. Tools and equipment need their own cover; see tool insurance for tradies.
- Hot work and underground work done without the required precautions. The GIO wording excludes welding, grinding and cutting, and digging or excavation, unless you complied with the relevant safety laws and Australian Standards.
- Professional advice or design you're paid for, which is professional indemnity.
Tool insurance for tradies: the conditions that matter
Tools cover (often called portable equipment, portable and valuable items, or tools of trade cover) pays to repair or replace tools and equipment that are stolen or damaged. Your home contents policy is usually not a substitute: many limit or exclude business tools, and cover at home rarely extends to a job site.
The value of a tools policy is in its conditions, especially for theft from your ute or van, items above the unspecified per-item limit, and whether the payout is new-for-old. Our guide to tool insurance for tradies sets out the conditions to check, with an example from a current PDS.
Insurance by trade
Every trade needs public liability, but the risks that decide a claim differ from trade to trade. Use the table to know what to ask before you compare quotes, then check the answers in the policy wording.
| Trade | Covers to look at first | What to check in the policy |
|---|---|---|
| Electricians | Public and products liability, tools | Whether faults in work you've completed are covered under products liability, and that every type of electrical work you do is declared |
| Plumbers | Public and products liability, tools | Water damage from completed work, conditions on hot work such as soldering, and damage to underground pipes and services |
| Carpenters | Public liability, tools | Limits on work at heights, and damage to the property you're working on (care, custody and control) |
| Builders | Public liability, contract works, tools, home warranty for residential jobs | Whether contract works covers the building during construction, principal's indemnity for head contractors, and the home warranty rules in your state |
| Painters | Public liability, tools | Height and scaffolding limits, and damage to the surfaces and property you're working on |
| Concreters | Public liability, tools and plant | Whether damage to underground services or from excavation and vibration is excluded, and how mobile plant is covered |
| Bricklayers | Public liability, tools | Work at heights and on scaffolding, and damage to neighbouring property |
| Landscapers | Public liability, tools and plant | Damage to underground services, and whether machinery such as an excavator is covered or needs separate cover |
State-by-state licence and insurance rules for trades
Licensing sits beside your insurance, so describe your work to an insurer the same way your licence does. Each state sets its own thresholds, and residential building work above a set value also needs home warranty insurance taken out in the owner's name. The table shows only the rules we've confirmed with each state's regulator.
| State | When you need a licence or registration | Insurance tied to residential work or the licence |
|---|---|---|
| NSW (Building Commission NSW) | A contractor licence for residential building work over $5,000 including GST, and for all electrical wiring, plumbing, drainage, gasfitting, air conditioning and refrigeration work | Home Building Compensation Fund cover for residential building work over $20,000 including GST, before work starts or payment is taken |
| VIC (Building and Plumbing Commission) | Registration for domestic building work worth more than $10,000, and for re-blocking, re-stumping, demolition, removing a home or any work needing a permit, whatever the cost | Home Warranty Scheme cover for domestic building contracts over $20,000 signed from 1 July 2026 |
| QLD (QBCC) | A licence for building work valued over $3,300, and for plumbing, drainage and gas fitting of any value. Eligibility covers qualifications, experience, minimum financial requirements and, for some licence classes, professional indemnity insurance | Queensland Home Warranty Scheme cover for residential construction work over $3,300 |
| WA (Building and Energy) | A registered builder for most building work valued at $20,000 or more that needs a building permit; from 1 July 2026, sheds, carports and garages under $50,000 don't need one | Home indemnity insurance for residential work needing a permit and valued over $20,000 |
| SA (Consumer and Business Services) | A building work contractor's licence for any business that carries out or organises building work for others, or to sell or let land or buildings, including subcontractors; all building work must be supervised by a registered building work supervisor. No value threshold is stated | Building indemnity insurance for building work needing development approval and valued at $20,000 or more (from 10 November 2025). Builders doing major residential construction must attach a certificate of eligibility for it to their licence application |
| TAS (Consumer Affairs Tasmania, formerly CBOS) | A building services licence to manage, carry out or contract building work, other than low-risk work under the Building Act 2016; no value threshold. Plumbing and electrical contractors need a contractor's licence to contract for that work | $5 million public liability for builder, fire protection services and demolisher licences, plus evidence of contract works insurance for builders; at least $5 million cover for injury and property damage for plumbing contractors, and $5 million public and products liability for electrical contractors. No compulsory home warranty insurance |
| ACT (City and Environment Directorate) | A licence under the Construction Occupations (Licensing) Act 2004 for builders (classes A to D), electricians, plumbers, drainers and gasfitters; carpenters and bricklayers don't currently need one | Residential building work insurance, or a fidelity fund certificate, for houses and apartment buildings of three storeys or lower (not car parks); minimum cover $200,000 from 1 January 2025 |
| NT (Building Practitioners Board) | A registered building contractor for prescribed residential building work: work worth more than $25,000 on a house, duplex, townhouse or unit building, or an extension that increases its floor area | A fidelity fund certificate for each job of prescribed residential building work, before the building permit or any payment; the trigger rose from $12,000 to $25,000 for certificates issued after 30 March 2026 |
Working in a private home or on a commercial site
On a commercial site, the head contractor usually sets your insurance in the subcontract: a minimum public liability limit, a certificate of currency, and sometimes principal's indemnity or being noted as an interested party. Check what the contract says before you sign it, because the contract sets the requirement.
In a private home you deal with the homeowner directly, and the risks shift to their property: damage to the home you're working in, water and fire damage from completed work, and theft of tools from a vehicle parked outside. Residential building work above a state's threshold also brings licensing and home warranty insurance rules that commercial work doesn't, and builders carry extra cover again: see builders insurance.
Your ute or van
A personal car insurance policy may not cover a vehicle used mainly for work, and insurers generally expect business use to be declared. Commercial motor policies are built for that use, and some cover signwriting, racking and fixed equipment. Our guide to business car insurance covers how insurers treat work use. Tools inside the vehicle are usually not covered by a motor policy, so they need their own cover. CTP insurance, which covers injury to people, comes with registration and is separate again: see CTP in each state.
Workers comp once you take on an apprentice or employee
The moment you employ someone, including an apprentice or casual labourer, you must have workers compensation cover under your state's scheme. Some states set a low wage threshold before a policy is needed, but apprentices and trainees are commonly caught regardless of wages. Check the rules for your state's workers compensation scheme.
Subcontractors are the grey area in the trades. Every scheme has tests for whether a contractor is really a worker in law, and a subcontractor who supplies only their labour, works under your direction and is paid by the hour can be a deemed worker for workers comp even with an ABN. If that happens and you have no policy, the premium you should have paid can come back to you, along with penalties.
Cover for you if you can't work
If you are a sole trader or working partner, workers compensation doesn't cover your own injuries, in any state. A broken wrist or a back injury can stop your income overnight while the loan repayments, rego and insurance keep coming.
Two products fill the gap. Personal accident and illness insurance is a general insurance product that pays a weekly benefit for a limited period after an injury or illness, and is often sold alongside tradie packages. Income protection insurance is a life insurance product that replaces part of your income for longer benefit periods, with more complex underwriting. Compare waiting periods, benefit periods and how each defines being unable to work.
How to compare tradie insurance quotes
Tradie premiums are driven by your trade, your turnover and what you do on site. Give every insurer identical details:
- Your exact trade and the work you actually do. A carpenter who also does roofing, or an electrician who works on commercial switchboards, needs that declared.
- Annual turnover, the number of workers and the amount you pay subcontractors.
- The public liability limit your contracts require, and whether products liability is included.
- The value of your tools, whether any must be specified, and whether they're kept in a vehicle overnight.
- Your claims history.
- The excess on each section. A low premium with a high property damage excess can cost more at claim time.
General advice only. This information doesn't take into account your objectives, financial situation or needs. Consider whether the product is right for you and read the Product Disclosure Statement (PDS) and Target Market Determination (TMD) before you decide. We don't compare every product in the market, and we may earn a commission if you take up a product through our links.
What to watch for
- Describe your trade exactly. A policy for "handyman" work may not cover electrical, gas, roofing or structural work, and the wrong occupation description is a common reason claims fail.
- Check the tool theft conditions before you need them: forced entry, lockboxes and overnight vehicle rules differ between policies.
- Ask the head contractor what they need on the certificate of currency (limit, interested party, principal's indemnity) before you buy, not after.
- If you use subcontractors, check the workers comp contractor rules in your state. An uninsured deemed worker can mean a back premium.
- Don't rely on your home contents policy for tools of trade.
Common questions
What insurance do I need as a tradie?
At minimum, most tradies hold public liability (usually required by head contractors and clients) and cover for their tools. Workers compensation is compulsory once you employ anyone, CTP comes with vehicle registration, and residential builders need home warranty insurance where the state requires it. Personal accident or income protection covers you, because workers comp doesn't cover sole traders.
Is tradesman insurance the same as public liability?
No. Public liability is the main part of it, but "tradie insurance" usually means a package that also includes tools cover and sometimes vehicle, personal accident and products liability cover. Public liability alone won't pay to replace stolen tools or cover you if you're injured.
Do tradies need public liability insurance by law?
In most cases no law requires it, but builders, head contractors, councils and many commercial clients make it a condition of work, and some state licensing schemes require it for particular licences. In practice most tradies can't get work on commercial sites without it.
How much does tradie insurance cost?
It depends on your trade, turnover, number of workers, the public liability limit, the value of your tools, your claims history and the excess. Higher-risk trades such as roofing and electrical work generally cost more than lower-risk ones. Compare quotes with identical trade descriptions, limits and excesses to see the real difference.
Does my car insurance cover my tools?
Usually not, or only up to a small limit for personal items. Tools of trade generally need their own cover under a tools, portable equipment or general property policy. Check your motor policy's contents limit and exclusions.
Do I need workers comp for my apprentice?
Yes. An apprentice is an employee, so you must hold workers compensation cover under your state's scheme. Apprentices and trainees are often covered by the rules even where a small-wages exemption would otherwise apply.
Do ABN holders need insurance?
An ABN doesn't by itself require any insurance. For a tradie, the requirements come from what you do: workers compensation once you employ anyone, including an apprentice, CTP with vehicle registration, home warranty insurance for residential building work in the states that require it, and public liability wherever a contract, site or licence demands it.
What is not covered by tradie public liability insurance?
Usually the cost of fixing your own faulty work, damage to property in your care, custody or control, injury to you or your employees, your tools, and professional advice. Some policies also exclude hot work or digging unless you followed the safety standards. Each of those needs a different cover, or careful reading of the policy's extensions.
What do I have to tell my insurer?
Everything relevant to the insurer's decision, including things the form doesn't ask about, because business policies carry the full duty of disclosure under the Insurance Contracts Act. Our public liability guide explains it under "What do I have to tell my insurer?": see public liability insurance.
Is tradie insurance tax deductible?
The ATO lists public liability, workers compensation, motor vehicle and similar business insurance premiums among the operating expenses a business can generally deduct. Personal cover such as income protection has its own rules. Check with your accountant.
General information only
This page explains how tradie insurance generally works. It is not advice about your business or any particular policy. Licensing and compulsory insurance rules differ by state and trade, so check with your state's building or licensing regulator, and read the Product Disclosure Statement before you buy.