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Contractor Insurance

Insurance for Contractors

The majority of limited company contractors will hold some form of professional indemnity or liability insurance. These will differ depending on the type of work you are doing and the specific client you are working for.

Need Contractor Insurance? Buy Online with Qdos Contractor

Contractor Insurance

We have put the following FAQ guide together, which should be of assistance when considering which policies you should purchase.

Insurance question? Submit your queries to Contractor Doctor

Which policies should I consider?

The three most common insurances held by freelancers and contractors are Professional Indemnity Insurance, Public Liability and Employers Liability. Broadly speaking, these cover you against negligence in various circumstances.

You may also wish to consider policies such as Business Interruption, Jury Service Cover, Income Protection and Office Contents (if you have a business premises).

Is insurance required by law?

Generally the only insurance required by law is Employers Liability. However, there is a specific exclusion to this rule if you are the only director/employee of your company. If there is more than one worker in your business (i.e. if you employ your spouse), you will probably be legally required to carry Employers Liability insurance.

So why should I buy them?

There are a number of reasons and benefits to having business insurance in place:

  • The majority of recruitment agencies and end clients demand that you hold insurance as part of your contractual agreement.
  • It is good practice to protect your business against unforeseen circumstances, giving you peace of mind.
  • If you are operating outside IR35, purchasing insurance is a key indicator of being in business on your own account.

What level of cover do I need?

This will depend on your contract and nature of business. However, most contractors hold Professional Indemnity Insurance at £1m, Public Liability at £1m and Employers Liability at £10m. Your agency will generally stipulate the minimum levels required contractually, but you should always assess your business risk.

How much does insurance cost?

The premiums for contractor insurance have reduced over the years with numerous insurers competing. The exact prices will depend on what you do, your turnover and the level of cover you select. However, if you are a fairly standard IT contractor with turnover of less than £150k you should be able to purchase all three key policies for less than £300 combined.

Many brokers and insurers accept monthly payments for these policies and it is classed as a business expense for tax purposes.

Where should I get them from?

A quick internet search will through up countless providers and it’s fairly easy to compare prices. Our chosen partner, Qdos Contractor offer particularly competitive premiums, and most of their business insurances also include a FREE IR35 Contract Assessment. For IT contractors needing Professional Indemnity Insurance (£1m), Public Liability (£1m) and Employers Liability (£10m) is only £272 per year at time of writing (last updated 20/09/2017). Simply visit the Contractor Insurance shop to purchase any of the products listed within this guide.
Contractor Insurance is also available for tradesmen from our partner Rhino Trade Insurance.

 

Contractor Insurance Discount

We have negotiated an exclusive 10% discount off Professional Indemnity and Public Liability Insurance policies with leading contractor insurance providers, Qdos Contractor, for Contractor Weekly readers. Fill in the form below to access your discount.

 

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