Public Liability Insurance for Tradies: Rules and Costs

Public liability insurance pays compensation and legal costs if your work injures someone or damages their property, like a dropped tool hitting a passer-by or a drill bit puncturing a client's water pipe. It isn't compulsory for every tradie, but some licences require it, including electrical contractor licences in Queensland, Victoria and WA. Head contractors commonly demand $10 million, and commercial or government sites $20 million.

This is general information, not financial product advice, and it doesn't consider your circumstances. Read the Product Disclosure Statement (PDS) and Target Market Determination (TMD) for any policy, and consider getting advice. For how public liability works in general, see our public liability insurance guide; for prices across all occupations, how much public liability insurance costs; and for licences, pricing and subbie rules, how to start a trade business.

Tradies' public liability at a glance

As published by the sources named, checked 18 October 2026.

Is public liability compulsory for tradies? State by state

There's no national rule. The requirement, where there is one, sits in your state's licence conditions, and we found it mainly for electrical contractors. The table shows what each regulator's own page says, and where we couldn't confirm.

Watch for conflicting claims. Some insurer blogs say NSW, WA and SA each impose a $5 million minimum on electricians. The NSW and WA regulator pages we read don't say that: NSW sets no public liability condition, and WA requires a policy without naming an amount. If you're told a licence needs a set amount, ask for the regulation or licence condition and read it yourself. Our business licences guide explains where to look.

Queensland and the ACT have rules about the name and disclosure. Queensland requires an electrical contractor's policy to be in the legal name of the licensed business, and the ACT requires licensees to show clients their insurance before starting work. In both cases, a policy in your personal name when you trade through a company can cause problems.

What head contractors and clients demand

As published, checked 18 October 2026.

Trade Risk, a broker, says 53% of its customers choose $5 million, 21% $10 million and 26% $20 million, while upcover says $10 million is the most commonly arranged limit. The right number is whatever your highest-paying contract requires. If a builder you want to work for asks for $20 million, a $10 million policy keeps you off the site, however cheap it was.

Contract wording that changes your cover

Head contractors rarely stop at a dollar figure. Before signing, look for:

• Principal's indemnity. upcover defines it as extending protection to the project principal, client or head contractor using the same limit and terms as your policy, and says construction contracts often require it.
• Being named as an insured or interested party. Hutchinson's terms require the contractor to be named as an insured on each policy other than workers compensation.
• Cross liability. Where several parties share a policy, each is treated as separately insured.
• Waivers of subrogation and hold-harmless clauses. upcover notes that you must not waive your insurer's right to recover from others without its consent, and gives signing hold-harmless agreements as an example. Signing one without telling your insurer can put a claim at risk.
• Indemnities wider than your legal liability. Public liability policies commonly exclude liability you take on only through a contract.

If the contract asks for any of these, tell your insurer before you sign and ask for written confirmation. Our unfair contract terms guide covers clauses that may not be enforceable against a small business.

Claim scenarios for trades

These examples come from insurers' and brokers' own pages. Whether a real claim is paid depends on the facts and your policy wording.

Trade Risk reports an average public liability claim of $6,167 across its own data to 2019. Most claims are modest, but the rare large one, such as a fire or a serious injury, is what the limit exists for.

What public liability doesn't cover for tradies

Products liability is the other half of a trade policy. If you supply and install fittings, switchboards, hot water units or materials, make sure the schedule says "public and products liability". Our product liability guide explains why installers count as suppliers.

Covers that commonly sit alongside

As published, checked 18 October 2026.

Home warranty catches people out because the names sound similar. It isn't liability cover, it's bought per job in most states, and it must be in place before you take a deposit in NSW. Our trade business guide lists the thresholds alongside licence rules. For other covers sole operators look at, see sole trader insurance.

Subcontractors, apprentices and labour hire

• Your subcontractors usually need their own policy. HIA Insurance Services says subcontractors aren't covered because they aren't direct employees, and Marsh says their public liability must be arranged separately from contract works.
• Your own policy may limit numbers. HIA's trade policy covers up to seven onsite workers and one trade only; Marsh's online public liability covers up to 10 employees.
• Heavy subcontracting can raise premiums. Trade Risk says premiums may rise when 20% or more of revenue goes to subcontractors.
• Employees need workers compensation. Public liability excludes them, and state schemes have their own tests for when a contractor counts as a worker; see employee vs contractor.

Before anyone starts on a job, collect their certificate of currency and check the business name and ABN, the limit, the period, products cover and that the occupation matches the work. Diarise expiry dates. If you're the subcontractor, expect the same check from the builder, and send a fresh certificate after every renewal so payments aren't held up.

What does public liability cost for a tradie?

Trade is priced by occupation, turnover and limit first. Every figure below names its source and what it measures; read the "type" column before comparing rows.

All figures as published, checked 18 October 2026. Trade Risk says Queensland electricians and Victorian plumbers pay slightly more because of their licence requirements.

What tradies spend on all their insurance

BizCover also publishes what customers in each trade spend on all the business insurance they buy through it (public liability plus tools, personal accident and other covers). Its average across tradies is $87.50 a month (1 July 2025 to 30 June 2026).

Source: BizCover occupation pages, checked 17 to 18 October 2026.

Worked example: pricing the step to $20 million (illustrative)

An electrician quoted at upcover's entry-level figures pays about $508 a year at $10 million and $577 at $20 million, a difference of $69 a year, or about $5.75 a month. If one builder you want to work for requires $20 million, the step costs less than an hour of billable time a year. The same logic applies at higher turnover, though the dollar gap grows: All Trades Cover's bands run from $700 to $1,200 at $10 million and $1,500 to $2,200 at $20 million. Ask for quotes at both limits on the same day, with the same excess and occupation, so you're comparing like with like.

Stamp duty adds 0% (ACT) to 11% (SA) on top of GST, and eligible NSW small businesses can claim a duty exemption on public liability. The state table is in our cost guide. Premiums are generally deductible, and GST-registered tradies can claim the GST credit; see sole trader tax deductions.

What insurers ask tradies when quoting

Have these answers ready. Getting them wrong can lead to a refused claim.

1. Your exact trade and every activity, including side work outside your usual trade (HIA's policy covers one trade only; VIZ allows up to three occupations).
2. Annual turnover and the split between residential and commercial work.
3. Number of employees and apprentices, and what you pay subcontractors and labour hire.
4. The sites you work on, especially airports, rail, mines, ports and shopping centres.
5. Whether you do hot work, work at height, excavation, or work near underground services.
6. Products you supply or install.
7. The limit and excess you want, and any principal's indemnity or interested party your contracts require.
8. Claims in the last five years.

Our public liability guide has the full list of questions and a general pre-purchase checklist. Keeping job records in one place makes renewals and claims easier; see job management software for tradies.

Recent changes to watch

• NSW professional indemnity for building practitioners. The NSW Government says registered building practitioners must be indemnified from 1 July 2027 (page updated 6 July 2026). BizCover's tradie page gives July 2026, so rely on the government date.
• Victorian duty cut. Duty on business insurance, including public liability, is 7% for policies taken out or renewed from 1 July 2026 and falls each year to nil from 1 July 2033 (see our cost guide).
• WA electrical licensing evidence. WA's application page (updated 23 September 2026) wants a public liability certificate printed within 30 days of applying.
• Fresh price data. upcover published trade figures in August 2026 and BizCover's tradie average now uses a 2025–26 report, so older averages may overstate or understate today's prices.

Pre-purchase checklist for tradies

1. Licence. You've read your licence conditions and know whether they set a public liability minimum or name requirement.
2. Contracts. You've taken the highest limit any builder, client or tender will ask for in the next 12 months.
3. Products. The schedule says public and products liability if you supply or install anything.
4. Activities. Every activity is declared, including hot work, height, excavation and side work.
5. Contract terms. Principal's indemnity, interested party, cross liability or waiver of subrogation requests are approved by your insurer in writing.
6. Exclusions. You've read the asbestos, faulty workmanship and contractual liability exclusions and any hot work condition.
7. Tools. You know your per-item limit and whether theft from a vehicle or open tray is covered.
8. People. Workers compensation is in place for employees, and you collect every subcontractor's certificate.
9. Home warranty. You know your state's threshold and buy cover before taking a deposit where required.
10. Name. The policy is in the same legal name as your licence and contracts.
11. Paperwork. You've saved the PDS, schedule and certificate of currency, and set a renewal reminder.

Key takeaways

• No law makes public liability compulsory for all tradies, but Queensland and Victorian electrical contractors need at least $5 million, and WA electrical contractors need a current civil liability policy.
• NSW, ACT and the WA plumbing and building licences we checked set no public liability minimum; home warranty insurance, which they do require above set thresholds, is a different product.
• Head contractors commonly ask for $10 million, and shopping centres, tenders and government sites $20 million. Some builders require you to name them on your policy.
• Public liability excludes fixing your own faulty work, your tools, your own injuries and usually asbestos. Tools, personal accident and contract works are separate covers.
• Published prices range from $43.62 a month for a sole trader at $5 million (BizCover, April 2025) to $2,282 a year for a $2 million carpentry business at $20 million (Trade Risk, 2025).
• Subcontractors generally need their own policy. Collect certificates of currency before anyone starts, and read indemnity clauses before you sign a subcontract.

Where to get help

• Your licensing regulator for insurance conditions on your licence: Energy Safe Victoria, WorkSafe Queensland's Electrical Safety Office, WA Building and Energy, Building Commission NSW, QBCC, Consumer and Business Services (SA), CBOS (Tas), Access Canberra and NT WorkSafe.
• Home warranty schemes: NSW home building compensation and QBCC home warranty.
• business.gov.au: business insurance, including workers compensation obligations.
• Moneysmart (ASIC): moneysmart.gov.au for guidance on buying insurance and reading a PDS.
• National Insurance Brokers Association: niba.com.au to find a broker for contract wording or larger jobs.
• Australian Financial Complaints Authority: afca.org.au if an insurer refuses a claim you think is covered.
• A construction lawyer before you sign a subcontract with wide indemnity or insurance clauses.

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