Is Your Standard Liability Coverage Adequate As a Tradesman?
As a tradesman (or tradie to use the "proper" Australian vernacular!), you know that you need to maintain adequate levels of insurance coverage to protect you and others who may work in the team. As this is a very important part of the operation you may already have public liability insurance in place and feel that you are adequately covered for all eventualities. However, this is not necessarily the case and you may need to have another look at your exposure, in association with your insurance adviser. What might you be missing?
Always Check the Fine Print
If you take a close look at the small print of your public liability insurance certificate, you will see within the detail that you are covered in case of any property damage or personal injury to others and this is all well and good, but it's only as a result of your own negligence. The key thing to remember is that you may become liable in certain circumstances, even though you're not negligent at all. How on earth is this possible, you may ask.
Essentially, it's due to the fact that you may have signed a specific contract with a client, or in the role of a subcontractor with a separate contractor. In turn, you need to look very carefully at the fine print of these contracts to see whether they are essentially passing down responsibility to you, should anything go wrong. It's not unusual for a subcontractor to be landed with the entire responsibility for a loss, even when this may not have been directly attributable to them. Certainly, this may not seem as if it's fair or equitable, but it's definitely a case of checking a contract carefully and refusing to sign it if you feel that you are being put at risk in this way. You should certainly consider asking for a modification to the contract to exclude you from anything that cannot be attributed to your actions.
Taking a Separate Policy
Alternatively, you might like to consider taking out a separate contractual liability policy to cover you in exactly this type of scenario. In this way you will have two differing types of insurance, which cover completely different areas. One covers you for errors due to negligence and the other one covers you for errors that were not your fault, but were simply passed to you due to the terms of a contract.
Ask Your Adviser
You're advised to chat with a trades insurance broker before continuing with any work that is covered by a contract of this type, so that you can sleep more easily at night.