Whether you’ve just become a carpenter or bring years of experience to the table, you need to arrange your own insurance as a self-employed carpenter. There are 4 primary types of insurance a carpenter should buy to protect both themselves and their business financially in case of disaster. This article will explain how these carpenter insurance coverages work so you can decide which might be appropriate for you. Because without the right insurance, you put both your personal finances and business at risk.
Public liability insurance for carpenters
Public liability insurance for carpenters protects against situations where a personal injury or property damage is linked to your business. If a client or other third party is injured or their property damaged and they blame your business, they can bring legal action against you. Public liability insurance covers both legal defence costs and compensation you’re bound to pay as a result of your business’s negligence.
For example, consider a situation where you leave a toolbox near the top of the stairs while you’re moving a piece of furniture. Your client walks by, perhaps they’re distracted by your efforts, and they don’t see the toolbox. They trip over it and fall down the stairs, incurring serious injuries. They sue you, as a result, claiming you were negligent in having left the toolbox there.
Even if you hadn’t been negligent and a claim was frivolous (e.g., a client blames you for a broken bannister that had clearly been loose and showing signs of wear for a long time), a public liability insurance policy could assist with the costs to defend against the claim.
Tools insurance for carpenters
Since carpenters and joiners cannot ply their trade without tools, tools insurance should be a primary consideration. Tools and equipment insurance will protect against theft or loss due to covered events like a fire or flood. Insurance won’t cover defects fault as these would be the responsibility of the manufacturer. Insurance also won’t protect against wear and tear or simply misplacing your tools.
Tools insurance can cost well under £100 a year to protect tools worth £2,000 in total, with prices rising for tools worth more. When you combine your tools cover with other insurance types like public liability, you may get a discount on your premium.
To save money on tools insurance, don’t leave them locked in a vehicle at night. Insurers ask where you keep them overnight when they’re calculating your quote. A recent study by NimbleFins showed that if you’re able to store your tools in a secure, locked building at night instead of in a vehicle, you can save hundreds of pounds on your carpenter insurance.
Take careful stock of the tools you own and figure out their replacement costs. By doing so, you’ll get an idea of how much insurance you need. It is good to have a record of your tools, including photos, receipts and replacement costs, to hand anyway in case you ever need to claim. Your insurer might ask for proof of the tools you owned that were damaged or stolen. And if someone steals your tools without any records, you have only your word, which may not be enough for the insurer.
Professional indemnity insurance for carpenters
Carpenters who design, give advice or work on high-end projects should seriously consider buying professional indemnity coverage. Professional indemnity (PI) protects against situations where a client is unhappy with your service or advice.
For example, consider a situation where a client asks you to design and build a custom bookshelf with skinny shelves for them to store their collection of antique china. Despite your best efforts, a flaw in the design results in the shelves collapsing under the weight of the china, and your clients’ precious collection crashes to the floor and shatters. They sue you as a result of damages.
A professional indemnity insurance policy could help arrange and pay for your legal defence, as well as paying any compensatory payments you’re found liable to pay. Even if a claim was without merit (e.g., say you gave the client strict instructions regarding the maximum weight per shelf and they far exceeded that), there would still be legal bills to pay to fight the frivolous claim. PI insurance would also pay for legal defence costs in these situations.
Personal accident insurance for carpenters
Since carpenters deal with dangerous tools and equipment, they should consider buying a personal accident cover. If you’re an employee, your employer might have arranged this for you. But if you’re self-employed, you’ll need to buy your own personal accident cover.
This can provide funds to help replace lost income while you’re off work recovering from a work-related accident. Or in the case of a more serious incident that has a long-term impact, some policies pay out a lump sum amount to you or your family.