How to check if a tradesman is insured
When you hire a tradesman to carry out work on your home or business premises, it always comes with risks. However, from checking a contractor’s previous reviews online to asking about their qualifications before giving them the job, there are ways to protect yourself.
One of the most important things to do prior to hiring is making sure the individuals you are working with have business liability insurance. After all, if their work causes injury or illness, or leads to property damage, you need to know the tradesman has the cover to pay any compensation that might be due.
In this guide, we explain how to find out if a tradesman has insurance. We also look at the different types of policies that small businesses should have. Finally, we explore the consequences of hiring an uninsured tradesperson.
How to find out if a business has insurance
In the UK, the only form of insurance businesses are legally obliged to display is their employers’ liability insurance certificate. This is because all businesses that employ staff must hold a policy of this type.
On the other hand, when it comes to third party policies, such as public liability insurance, businesses do not have to provide their insurance certificate. If insured, most tradespeople will provide proof of cover when asked.
With the above in mind, the only definitive way to know if a business has insurance is to ask. For this reason, when hiring a trades contractor, it is always a good idea to stipulate they must provide evidence of liability insurance before starting work. This condition can even be written into the contract you hold with a prospective tradesperson.
What insurance should I ensure a business has before working with them?
The types of insurance policies you need to look out for depends on the type of work you are hiring a tradesperson to do. However, there are three key policies to pay special attention to. These are:
This cover can be essential if the tradesperson you are hiring will be carrying out physical work. For example, any building work, electrical work, tiling or plumbing. Public liability covers any legal costs arising from a claim involving public injury or damage to property caused during/by the work carried out. This also includes any compensation payments if the tradesperson is found to be at fault. For example, say a tradesperson damages a wall with an item of equipment while working on your driveway. In most cases, public liability insurance would cover the cost of any damages if a claim is made by the wall’s owner.
This insurance is important if you are hiring a tradesman to provide professional advice. For example, if you hire a surveyor or architectural consultant. Professional indemnity insurance will pay all legal costs if it is decided the tradesperson’s professional advice or negligence caused you, the client, financial loss or reputational damage. For example, imagine an electrician provides rewiring plans that contain errors. If these plans are used and the subsequent work doesn't function correctly due to the design errors, the electrician could be found to be negligent. In this case, their professional indemnity insurance may cover any compensation costs you are due, should you choose to make a claim.
What are the consequences of hiring an uninsured tradesman?
If you hire an uninsured tradesperson, you may be personally liable to cover the costs if anything goes wrong. This can take two different forms - damage to property and personal injury. Below we take a look at what consequences each can have on you as a client.
Damage to property
When it comes to contracting work, accidents happen. Even if you hire the best-rated tradesperson you can find, you cannot guarantee something will not go wrong while they are working. It can become a major issue if they are uninsured and either your property, or the property of a third party, is damaged or destroyed in the course of their work.
Property damage encompasses a lot of things. From scratching the floor or ripping wallpaper to flooding the bathroom or smashing a window while working, even the smallest of accidents can cost a lot to fix. If this damage is caused by an uninsured tradesperson, you may be fully responsible for the repair bill.
Third party injury
If a work-related accident occurs on your property, you may be held liable for any injuries if the tradesperson is not insured. For example, if a builder leaves equipment lying around your home and a third party, such as a family friend, trips over it and injures themselves, you could be liable for any compensation due to be paid, should the individual choose to sue you. If, on the other hand, the builder holds public liability insurance, this policy would cover any costs of this nature.
Here at Markel Direct, we offer all-encompassing tradesman insurance policies. These allow tradespeople to combine a number of the covers discussed above to create a single, specialised policy that suits a range of needs.
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