Do you need public liability insurance when subcontracting?

Yes, public liability insurance (PLI) is highly recommended and often mandatory when subcontracting to protect against third-party injury, property damage, or legal expenses. While sometimes not strictly required by law for the self-employed, most clients and main contractors mandate it to secure contracts, and it ensures you are not personally liable for damages.

Do you need public liability insurance if a subcontractor?

Yes, subcontractors should make sure that they have a public liability insurance policy. Whilst it's not a legal requirement to have this subcontractor liability insurance in place, making sure that your business has a public liability insurance certificate is recommended.

Why do subcontractors need public liability?

Why do the builder and subcontractor both need insurance? On any building site, there can be a multitude of businesses in operation at any given time. Each business should carry their own public liability insurance to cover claims against them, which may arise from the performance of their works.

What insurance do I need for subcontractors?

Public Liability Insurance is often required for self-employed tradies, subcontractors and trades businesses to take on jobs or enter worksites. You can get a quote online to see your options and build a policy to suit your business.

Do you have to have public liability insurance as a sole trader?

No, public liability insurance isn't a legal requirement for sole traders, but it's highly recommended because it protects you from hefty costs if you accidentally cause injury or property damage to a member of the public, and many clients or contracts require it as a condition of working with you. While Employers' Liability insurance is legally mandatory if you hire anyone, Public Liability covers the risks you face interacting with the public, clients, or working in public spaces, safeguarding your personal assets and finances. 

Subcontractor Insurance Requirements: What You Need to Know

Is it illegal to run a business without public liability insurance?

Is Public Liability a legal requirement? Public Liability insurance is not a requirement by law, but many clients will insist that you're covered for public liability before allowing you to begin work. Some trade associations will not allow you to register with them unless you have a valid liability policy.

What type of insurance do I need for self-employed?

Types of self-employed insurance you should consider include: Disability and life insurance. Health insurance. Dental and other insurance.

Who is liable for a subcontractor?

Subcontracts can therefore be an effective way of delegating contractual obligations to a third party. The main contractor remains liable for the performance of the main contract, with the result that it is liable to the other party to the main contract for any default in performance by the subcontractor.

What happens if I don't have public liability?

Although public liability insurance is not a legal requirement, failing to acquire this sort of cover could land you with a large bill if an incident arises where your company is sued for the likes of personal injury damage and associated compensation – this may run into several thousands of pounds, which is not ...

What are the liabilities of a subcontractor?

5 Common Subcontractor Liability Exposures

• Faulty workmanship. ...
• Third-party injury. ...
• Damage to property. ...
• Project delays and other breaches of contract. ...
• Pollution liability. ...
• 1) Thoroughly vet all subcontractors. ...
• 2) Ensure contracts are airtight. ...
• 3) Monitor subcontractors closely and regularly inspect their work.

How much is public liability insurance for a sole trader?

A public liability policy could cost less than $500 for a sole trader needing the minimum cover, through to $100,000+ for a much larger or higher-risk trade businesses. Click the button below for a quote, or keep scrolling to read our public liability cost guide.

How do I know if I need public liability?

You need public liability insurance if your business interacts with the public, visits client premises, hosts events, or operates from a space clients visit, as it covers claims for injury or property damage, protecting you from potentially devastating financial costs, even if it's often not legally mandatory for most businesses. Ask yourself if clients, customers, or the general public could get hurt or their property damaged due to your work; if the answer is yes, you likely need it. 

What happens if a contractor doesn't have public liability insurance?

This will depend on the terms of the contract. If your contract requires you to have it and you don't, then you will be in breach of contract. This will be the case even if you had cover, but it has expired. A contract will normally specify the level of cover you or your business needs.

Do I really need public liability insurance?

You likely need public liability insurance if your business interacts with the public, even if it's not legally required; it protects you from costly claims for injury or property damage, covering legal fees and compensation if a client gets hurt at your home office, you work at client sites, or organize public events. It's a vital safety net for most businesses, covering risks like a customer tripping on your premises or damaging their laptop, preventing significant financial loss, and often required by larger clients for contracts.

What is minimum public liability insurance?

Often the amount of cover you require will be dictated by the contracts you enter into. If your business is doing any work within shopping centres you will often find that the contract stipulates public liability of at least $20 million. The same is true of many government contracts.

Do you need public liability when subcontracting?

For subcontractors working on site, Public Liability Insurance is an invaluable safety net. Claims for damage to third party property, or injury to a third party, are not uncommon in a role that is by nature more hands on.

What insurance do subcontractors need?

If a subcontractor is deemed to be a labour only subcontractor, then they are likely to be viewed as an employee. This would make the main contractor responsible for them and their actions and would need to include the subcontractor on their Employers' Liability and Public liability insurance.

Do all self-employed people need public liability insurance?

Do I need sole trader liability insurance? Public liability insurance isn't a legal requirement for sole traders. But there are very few businesses that can safely operate without it. Whether you're a florist or a plumber, you're likely to be exposed to risks that may require public liability cover.

What happens if you have no public liability insurance?

In the event of an accident, a company will not only be prosecuted for having no public liability insurance, it will remain liable to the injured party and have to pay all the compensation, its own legal costs and the claimant's costs out of its own funds however in many cases this would result in the company ceasing ...

How much is public liability insurance for self-employed?

*The price is for up to £2 million of public liability insurance – 10% of customers paid £67.72 or less annually between 1st Jul – 31st Dec 2025. Equivalent to £5.64 a month (and excludes the extra costs for paying monthly). 84% of customers have a £1 million limit and 16% £2 million.

Why do contractors need public liability insurance?

If you carry out your contract work on client sites, or clients visit your premises, you should consider taking out public liability insurance. This will cover you against third party claims for property damage or personal injury.

What insurance do you need to be a sole trader?

Public liability for the self-employed and sole traders

All businesses need public liability insurance as they are bound to be in contact with clients, customers, or the public at some point.