How to Compare Contractor Insurance Policies (UK Guide)

Introduction

If you’re a contractor, your insurance isn’t just a box-ticking exercise—it’s what stands between a routine job and a financially painful claim. The problem is that contractor insurance policies can look similar on the surface, while hiding big differences in exclusions, limits, and claims support.

This guide walks you through a clear, practical way to compare contractor insurance policies in the UK, so you can choose cover that actually matches the risks of your trade, your contracts, and the way you work.

Step 1: Start with your contractor “risk profile”

Before you compare quotes, define what you’re comparing. Two contractors can need totally different cover even if they both say they’re “in construction.”

Write down:

• Your trade(s): e.g., general builder, electrician, plumber, roofer, groundworker, scaffolder, HVAC, joiner

• Typical job types: domestic, commercial, industrial, public sector

• Average contract value and largest job value

• Whether you do any design, specification, advice, or project management

• Whether you use heat (hot works), work at height, or dig/operate plant

• Whether you subcontract, labour-only or bona fide

• Whether you hire plant or tools, or store materials off-site

• Your contract requirements: minimum limits, specific clauses, proof of cover

This “risk profile” becomes your baseline for comparing policies like-for-like.

Step 2: Compare the core cover types (not just the premium)

Contractor insurance is often a package of multiple covers. When comparing policies, make sure you’re comparing the same building blocks.

Public Liability (PL)

Public liability covers injury to third parties and damage to third-party property arising from your business activities.

Compare:

• Limit of indemnity: commonly £1m, £2m, £5m, £10m

• Any inner limits: e.g., a lower limit for certain activities

• Property damage “care, custody and control” wording

• Heat work/hot works restrictions

• Work at height restrictions

• Depth limits for excavation/groundworks

• Use of plant and machinery

Tip: If you work on commercial sites, £5m is a common requirement. Domestic work may be fine at £1m–£2m, but always check your contracts.

Employers’ Liability (EL)

If you employ staff, you typically need employers’ liability by law in the UK (with limited exemptions). Many contractors also need EL if they use labour-only subcontractors.

Compare:

• EL limit: typically £10m

• Definition of “employee”: does it include labour-only subcontractors, casual labour, temps?

• Any exclusions for certain trades or activities

Professional Indemnity (PI)

PI is crucial if you provide advice, design, specification, surveying, consultancy, or if your contract includes design responsibility (even partly).

Compare:

• Limit of indemnity: £100k, £250k, £500k, £1m+ depending on risk

• Claims-made basis: PI responds when the claim is made, not when the work was done

• Retroactive date: how far back the policy covers past work

• Run-off cover: needed if you stop trading but could still face claims

• Contractual liability: does it cover liabilities you assume under contract?

Tip: Many contractors accidentally “do design” (e.g., specifying fixings, advising on load-bearing changes, or selecting materials). If you do any of that, compare PI carefully.

Contractors All Risks (CAR) / Contract Works

This covers the works in progress (materials and the part-built project) against events like fire, theft, flood, storm, vandalism.

Compare:

• Sum insured: maximum contract value at any one time

• Cover for materials on-site and in transit

• Theft conditions: security requirements, locked storage, alarms, fencing

• Off-site storage: is it included?

• Defects exclusions: what’s excluded vs what’s covered

Tools, Plant & Equipment

Often split into:

• Own plant/tools

• Hired-in plant

Compare:

• Single item limit and total limit

• Theft from vehicle cover and conditions (time limits, forced entry)

• Overnight storage requirements

• Hired-in plant limit and whether “continuing hire charges” are covered

Personal Accident / Income Protection (optional)

Not a “business liability” cover, but important for sole traders.

Compare:

• Weekly benefit amount and waiting period

• Maximum benefit period

• What counts as “accidental injury” vs sickness

Step 3: Check policy limits, sub-limits, and excesses

Two policies can both say “Public Liability £5m” but behave very differently once you look at the detail.

Compare:

• Excess (deductible) for each section: PL, PI, contract works, tools

• Different excesses for different perils: e.g., higher excess for theft or flood

• Sub-limits: e.g., £5m PL but only £25k for certain types of property damage

• Aggregate vs any one claim: especially relevant for PI

Practical approach: Build a simple comparison table with columns for each insurer and rows for limits, sub-limits, and excesses.

Step 4: Compare exclusions and “restricted activities”

Exclusions are where policies quietly diverge. Ask for the policy wording (or key facts) and scan for anything that clashes with your work.

Common contractor “watch-outs” include:

• Hot works exclusions or strict conditions (permits, fire watch, extinguishers)

• Work at height exclusions or limits (e.g., above 10m)

• Roofing exclusions (especially flat roofs)

• Basement work, underpinning, or structural alterations

• Asbestos exclusions (most policies exclude asbestos, but check the wording)

• Pollution exclusions (can matter for groundworks and fuel/oil incidents)

• Damage to the part you’re working on (sometimes excluded under PL)

• Defective workmanship exclusions (often excluded under PL; CAR may respond to resulting damage)

If any exclusion touches your day-to-day work, that policy may be cheaper for a reason.

Step 5: Compare “contractual requirements” compatibility

Many contractors buy insurance to satisfy contracts. The cheapest policy is useless if it doesn’t meet the contract wording.

Check your contracts for:

• Minimum PL/EL/PI limits

• “Principal’s indemnity” or “indemnity to principal” requirements

• Joint names requirements on contract works

• Waiver of subrogation clauses

• Specific endorsements (e.g., JCT clauses, non-negligent liability)

When comparing policies, confirm whether these can be included and whether they cost extra.

Step 6: Compare claims support and service (it matters)

Insurance is a promise to pay—and the claims experience is where you find out how solid that promise is.

Compare:

• Claims reporting: 24/7 helpline? online portal?

• Dedicated claims handler vs general queue

• Average claims settlement times (if available)

• Legal support: access to solicitors, helplines, or legal expenses cover

• Risk management support: hot works guidance, contract reviews, H&S templates

A slightly higher premium can be worth it if it comes with faster, clearer claims handling.

Step 7: Compare insurer appetite and trade accuracy

Contractor policies are sensitive to trade descriptions. If your trade is misclassified, you can end up with:

• Incorrect exclusions

• A declined claim

• A cancelled policy

When comparing quotes, make sure each insurer has the same:

• Trade description

• Turnover

• Wage roll (for EL)

• Use of subcontractors

• Work split (domestic vs commercial)

If one quote is dramatically cheaper, it may be because the activity has been rated differently.

Step 8: Compare optional add-ons that can save you later

Depending on your work, add-ons can be the difference between a manageable incident and a business-stopping loss.

Consider comparing:

• Legal expenses (contract disputes, employment disputes, tax investigations)

• Own damage to hired-in plant

• Contractual liability extensions

• Non-negligent liability (often requested by principals)

• Temporary works cover

• Goods in transit

• Business interruption (for larger contractors)

Don’t add everything “just in case,” but do compare the cost of the add-ons you genuinely need.

Step 9: Compare the documents you’ll need to show clients

In the real world, you’ll be asked for proof—often quickly.

Check:

• Certificate availability: immediate download?

• Policy schedule clarity

• Ability to issue endorsements fast

• Whether the insurer/broker can provide a “to whom it may concern” letter

If you’re tendering for work, speed and clarity can help you win jobs.

A practical contractor insurance comparison checklist

Use this checklist to compare policies side-by-side:

• Trade and activities accurately declared

• PL limit meets contract requirements

• EL included if needed; definition of employee is suitable

• PI included if you advise/design; retro date and run-off considered

• Contract works sum insured matches max job value

• Tools/plant limits match your kit value; theft conditions workable

• Key exclusions don’t conflict with your work (hot works, height, roofing, excavation)

• Excesses are affordable in a claim scenario

• Any endorsements required by clients are available

• Claims process is clear and responsive

Common mistakes when comparing contractor insurance

1) Comparing price without comparing cover

A £200 saving isn’t worth it if the policy excludes the work you actually do.

2) Ignoring PI because “I’m not a designer”

If you advise, specify, or manage, you may have PI exposure.

3) Underinsuring contract works

If your contract works limit is too low, you could be paying out of pocket after a fire or theft.

4) Not understanding subcontractor status

Labour-only subcontractors can create EL exposure. Clarify how your policy treats them.

5) Not checking theft conditions

Tools and plant claims often fail on security conditions. Make sure you can comply day-to-day.

FAQs

How much public liability do contractors need?

It depends on your contracts and risk. Many commercial clients require £5m. Smaller domestic contractors often choose £1m–£2m, but higher limits can be sensible if you work in high-footfall areas or on larger projects.

Do I need employers’ liability if I only use subcontractors?

Potentially, yes—especially if you use labour-only subcontractors who work under your direction. If you only use bona fide subcontractors with their own insurance, your position may differ. Always confirm with your broker.

Is contractors all risks the same as public liability?

No. Public liability covers third-party injury or property damage. Contractors all risks covers the work in progress and materials (your project assets), typically for events like fire, theft, flood, and storm.

What’s the difference between “any one claim” and “aggregate”?

“Any one claim” means the limit applies per claim. “Aggregate” means the limit is shared across all claims in the policy year. PI is often aggregate, so compare carefully.

Can I change my cover mid-policy?

Often yes, but it depends on the insurer and the change. If your turnover grows, you take on higher-risk work, or your contract values increase, update your policy immediately.

Conclusion: compare policies like a risk manager, not a bargain hunter

The best contractor insurance policy is the one that matches your real-world risks, meets your contract requirements, and will respond when you need it.

If you want a faster way to compare, start with your risk profile, line up the cover sections, then drill into exclusions, sub-limits, and claims support. That’s how you avoid nasty surprises—and keep winning work with confidence.

If you’d like, tell me your trade, typical contract size, and whether you do any design/advice, and I’ll turn this into a tailored comparison checklist you can use for your own quotes.