Short version: public liability insurance covers you if your work injures someone or damages their property and they claim against you. It’s often not legally required for every tradie, but head contractors, councils and many clients won’t let you on site without it, so most tradies carry it.
What it covers
- Injury to a member of the public caused by your work
- Damage to a client’s or third party’s property
- Legal costs of defending a claim
What it usually doesn’t cover
- Injury to your own employees (that’s workers’ compensation, which is compulsory if you have staff)
- Damage to your own tools and equipment (that’s tools or equipment insurance)
- Faulty advice or design (that’s professional indemnity)
- Your vehicle (that’s commercial motor insurance)
How much cover do you need?
Common limits are $5 million, $10 million or $20 million. Many head contractors and strata managers require at least $10 million, so check the contract before you buy. Higher limits cost more, but usually not dramatically more.
What it costs
Premiums depend on your trade, annual turnover, number of staff, claims history and cover limit. Low-risk trades with small turnover pay the least, and high-risk work like roofing or work at height pays more. Treat any price as a starting point and get quotes for your exact trade.
How to choose a policy
- Match the cover limit to what your contracts require.
- Make sure your actual work is listed, not just your trade title.
- Check the excess and exclusions, especially for work at heights, asbestos or underground services.
- Ask if cover includes subcontractors and what the policy says about them.
- Look at the insurer or broker, not just the price. Claims handling matters.
Other insurance to consider
Tools and equipment, commercial vehicle, income protection and, if you advise or design, professional indemnity. A broker can bundle these into a tradie package.
Do you legally need public liability insurance?
In most states and for most trades it isn’t compulsory by law, but there are many situations where you effectively need it: head contractors and builders, strata managers, councils and some clients will ask for a certificate of currency before you start. Some licensing bodies also have insurance requirements for certain work, so check the rules for your trade and state.
Example of how a claim could happen
Imagine a plumber replaces a pipe in a client’s kitchen. Weeks later the joint fails, floods the floor and damages cabinets and the floor below. The client claims against the plumber. Public liability insurance can pay for the legal defence and the damage, up to the policy limit, subject to the policy’s exclusions.
What is a certificate of currency?
It’s a document from your insurer that confirms your policy, its limits and the dates it covers. Clients and head contractors usually ask for it, and it’s easy to request from most insurers.
Questions to ask before you buy
- Is my exact type of work listed, and are any tasks excluded?
- What is the excess for a claim?
- Does it cover work at heights, or work on commercial sites?
- How does it treat subcontractors?
- Can I get a certificate of currency the same day?
Public liability insurance for tradies: FAQs
How much public liability cover do tradies need?
Many tradies choose $10 million or $20 million. Check your contracts, since head contractors often set the minimum.
Does public liability cover my tools?
No. Damage to or theft of your own tools is covered by tools or equipment insurance, which is a separate policy.
Do sole traders need public liability insurance?
Often yes, because clients and head contractors ask for it. Even if it isn’t legally required for your trade, a claim could be costly without it.
Is public liability insurance tax deductible?
Business insurance premiums are generally deductible. Confirm with your accountant.
Sources and further reading
- business.gov.au: Australian Government business information
- MoneySmart: ASIC’s independent money guide
General information only, not financial or insurance advice. It doesn’t consider your personal circumstances. Read the Product Disclosure Statement and speak to a licensed adviser before buying. We may earn a commission if you apply through links on this site, at no extra cost to you.