Are you a tradesperson? Find out how you can protect yourself, both at home and at work.
Tradies regularly face a wide range of hazards and the potential risk of injury, but the need to stay fit and healthy is crucial to any tradie's ability to earn an income. And when you consider that many tradespeople are self-employed and don’t have access to benefits like sick leave, the importance of personal accident insurance becomes clear. Personal accident insurance offers peace of mind by providing an ongoing monthly benefit when you are injured and unable to return to work.
What is the benefit of personal accident cover?
- Income protection. Cover for up to 75% of your income when you suffer an accidental injury and are unable to work.
- Ongoing payments. Benefits are usually paid on a weekly or monthly basis for a period of two to five years, replacing the income you are unable to earn and ensuring that you and your family can continue to cope with mortgage repayments, bills and other expenses
- Accidental death cover. Lump sum benefit payments to your family if you suffer a permanent disability or if you die.
Compare Life insurance quotes from these direct brands
Personal accident VS Income protection
Some people confuse personal accident insurance with income protection insurance and it’s not that hard to see why - these two policy types are quite similar in many ways. However, there are some important differences that can help you understand the cover offered by each policy. As you can see from the table below, each policy comes with its own pros and cons.
|Personal accident insurance||Income protection insurance|
|What is covered?||This type of cover only provides cover when you suffer an injury||Income protection insurance provides cover when injury or illness keep you out of the workforce|
|For how long?||Most policies can replace your income for a period of up to two or five years||This type of cover often offers income replacement until you reach 65 years of age|
|Benefits and options||Standard set of benefits are included in cover||A wide variety of benefits are included and you can also add several optional extras to your cover|
|Medical tests required?||You won’t have to answer any health questions or undergo any medical tests to take out cover||Some people will need to undergo medical tests before they will be approved for cover. This varies between insurers|
|Premium costs||Personal accident premiums are usually lower||Income protection insurance is often more expensive|
|Capital benefits available?||Yes, these are available in some circumstances||No capital benefit is included in cover. However, you may be able to bundle your policy with TPD insurance|
- If you're only concerned about cover in case of injuries and are looking for a more cost effective form of insurance, consider personal accident cover.
- If you're looking for a more rounded form of coverage that includes sickness cover, then you should consider income protection.
WorkCover or Workers Compensation covers tradespeople against work-related illness or injuries, providing that they work for an employer, that their illness or injury was sustained in the workplace and that it was the result of proven negligence on the part of their employer.
However, as most injuries occur outside of the workplace (approx. 75%), many tradespeople opt to take out personal accident cover as well to protect them 24/7 wherever they are. This can either be an individual policy or under a group personal accident policy which an employer takes out to cover all of their employees.
Does WorkCover cover self-employed people?
If you are a self-employed tradesperson, you are not covered by WorkCover, which only covers those who work for an employer. This makes personal accident insurance vital to protect your income should you not be able to work. The benefits include tax deductible premiums, a choice of benefit period and peace of mind knowing you will be able to pay the bills in the event of an accident. The only drawback is that illness is not covered, so you may wish to consider income protection insurance instead, which covers both accident and injury.
- Public and products liability insurance. This type of policy covers your legal liability when negligent acts related to your business cause personal injury or property damage to someone else. Public liability insurance is a type of insurance that covers businesses from claims made by third parties. Product liability insurance covers manufacturers and businesses for claims made because of products they've sold.
- General property insurance. General property damage covers loss or damage to your essential business equipment, including items like power tools and laptops.
- Fire and defined events insurance. When your business equipment, tools, contents, stock or buildings suffer loss or damage caused by fire, storm, lightning, explosion, impact or malicious damage, this type of policy provides the cover you need.
- Personal accident and illness insurance. If you suffer an injury or illness that prevents you from working, this policy provides an ongoing benefit to help you keep your head above water.
A tradie's tools are vital to his ability to get the job done, so you need to know your tools are protected against a range of risks. Tools of the trade insurance offers much-needed peace of mind, providing financial protection when your tools and equipment are stolen by someone else or damaged in an accident. Without tools of the trade insurance, loss or damage to your tools can cause massive problems for your business. In addition to the cost of repairing or replacing your tools, there’s also the problem of lost income, losing potential customers, fees for not completing the project on time and the risk of any legal action for failing to meet a deadline. Happily, tools of the trade insurance provides quick access to the funds you need to repair or replace your tools, and therefore minimise the risk of any further damage to your finances and your business’ reputation.
What tools can I cover?
Tools of the Trade can include cover for the majority of the tools and machines you use as part of your trade. You'll need to advise you're insurer of the tools and equipment you use, but generally you can get cover for items including:
- Computers, tablets and mobile phones
- Hand tools
- Power tools
- Machinery such as bobcats, excavators, tractors and generators
- Tool benches, cases and other storage components.
Many insurers offer specialised business insurance packages to protect the assets and needs of tradespeople. Rather than just offering one form of cover, for example tools of the trade, these business insurance packages combine multiple type of protection to offer a complete insurance solution. This form of business insurance can be hugely beneficial for builders, bricklayers, carpenters, electricians, gardeners, handymen, landscape gardeners, painters, plasterers, plumbers and tilers. A typical tradesperson insurance policy will cover a wide range of risks, including:
- Public and products liability. This covers your legal liability when negligent acts in connection with your business result in property damage or bodily injury to a third party.
- Personal accident and illness. This component provides an ongoing benefit when you are sick or injured and unable to work.
- Fire and other damage. Your building and business contents will be covered against fire, storm, lightning, impact, explosion, malicious damage and a range of other insured events.
- Business interruption. When an insured event such as fire or burglary disrupts your ability to run your business as usual, this type of insurance covers your resulting loss of profit.
- Burglary and theft. If your stock, tools and equipment are burgled or stolen, the cost of their repair or replacement will be covered.
- General property. This covers loss or damage to essential business equipment, including power tools.
- Other benefits. Other coverage features typically include tax audit cover, money cover, glass cover, equipment breakdown and more.
What else is covered in a business insurance for trades person? Find out more about Tradesperson Insurance
- Dishonest employees. Employee dishonesty protects your business by replacing any money or goods you lose because of employee dishonesty, but you can also try to make sure to always keep equipment in view and ask new staff to provide references from previous employers.
- Stolen or damaged property. General property cover protects your tools and other essential business equipment, but you can also keep your items safe by storing them in a lockable box when not in use and engraving them with your name. Remove tools from vehicles at night and store them in a locked garage, while it’s also a good idea to keep an inventory of your tools and other equipment.
- Car accidents. If you have several employees who use company cars, commercial motor insurance can protect you financially when accidents occur. Other helpful tips include using only licensed and experienced drivers and ensuring that utilities and vans have secure locks on their trays and rear doors.
- Workplace injuries. Workers’ compensation insurance covers you if an employee is hurt or falls ill as a result of their work, while there are plenty of other steps you can take to guarantee a safe workplace. Make sure your staff wear appropriate clothing, use proper safety equipment and train your workmen on how to lift, squat and kneel safely.
- Public liability. Public liability cover kicks in when you are legally liable for causing injury or property damage to a third party, while it’s also a good idea to avoid the use of hazardous materials and make sure the work area is safe and secure.
- Equipment breakdown. Tradesperson insurance policies include cover for equipment breakdown, plus you can also make sure to check your equipment is safe prior to use. Having backup equipment on hand is another good idea.
I’m just a tradie - do I really need to worry about insurance?
Do I need to take out a range of individual policies?
How do I know which policy is right for me?
What benefits does personal accident insurance provide?
What about public and products liability insurance - do I need it?
How much does personal accident insurance cost?
Personal accident insurance can provide crucial financial protection for tradespeople and form part of an effective overall insurance plan. As always, however, you’ll need to compare your options and shop around before deciding on the policy with the best cover for you.