Most subcontractors find out what insurance they need the day a head contractor asks for a certificate of currency and will not let them start without one. It is a bad moment to be arranging cover.
Here is what the main types actually do, which ones you are likely to be asked for, and the gap that catches sole traders out.
Public liability
This is the one you will be asked for on almost every job. It covers injury to other people and damage to their property arising from your work.
Public liability is generally not compulsory by law in itself, but that is close to irrelevant in practice. Many occupational licences require it, most sites will not let you through the gate without it, and head contractors make it a condition of engagement.
$5 million is the common baseline, and it is what a lot of licensing requirements are pitched at. Larger commercial and government projects frequently ask for $10 million or $20 million. Check the contract before you assume your existing policy is enough, because topping up mid-job is more expensive than starting at the right level.
Professional indemnity
Public liability covers physical harm. Professional indemnity covers the consequences of your advice, design or specification being wrong.
If your work involves designing, certifying, specifying or advising, you are likely to need it, and for some professions it is compulsory. It is easy to assume this only applies to consultants, but plenty of trade and technical work now includes a design or certification element.
Workers compensation, and the gap sole traders fall into
If you employ anyone, workers compensation is compulsory. That is not negotiable and the schemes are run at state level, so the rules and the premiums differ depending on where you operate.
Here is the part that catches people out. If you are a sole trader with no employees, you generally cannot take out workers compensation on yourself. You are not an employee of your own business, so the scheme does not cover you.
That means if you are injured and cannot work, there is no workers compensation payment coming. The cover that fills that gap is personal accident and illness insurance, or income protection. Neither is compulsory, and both are routinely skipped by people who assume they are covered because they hold public liability.
Public liability protects other people from you. It does nothing for your own income if you are hurt.
Tools, vehicles and plant
Not usually contractual requirements, but worth a thought. Your tools are your ability to earn. A vehicle used for work is often not adequately covered by a standard personal motor policy, and hired plant frequently carries a liability you have signed up to without reading.
The certificate of currency
This is the document that proves your cover is real and current. It is what a head contractor will ask for, and what will be checked before you are engaged.
Two practical points. Certificates expire, and an expired one will hold up your engagement just as effectively as having no cover at all. And the certificate needs to show the right entity name, which is a common failure when someone has changed from sole trader to a company and never updated the policy.
Keeping it current
The administrative burden here is real. Renewal dates for different policies rarely line up, and the reminder usually arrives while you are on site.
On Workforce Marketplace you can submit licences, certifications and insurance for verification, and your profile then shows the status against each one, along with the cover amount for insurance. Worth being clear about what that means: an insurance certificate is reviewed as a document. It is not confirmed with the insurer, because insurance is not held on a public register. Licences and registrations that do sit on an Australian regulator’s public register are checked against it.
That is a point-in-time check either way, so a hirer should still do their own due diligence on anything high-risk or high-value.
This article is general information, not insurance or legal advice, and it is not a recommendation about any policy. Requirements vary by state, trade, licence and contract, and cover differs between insurers. Read the policy wording and speak to a licensed insurance broker about your own situation.
