Key Takeaways:
- Contract works insurance protects your construction projects, tools and materials from damage, theft and unexpected events while building.
- It’s essential for builders, tradies and contractors who are responsible for a project’s progress or materials on-site.
- Public liability and contract works insurance cover different risks. Many trades businesses need both for full protection.
- Using a broker like All Trades Cover ensures you get the right level of cover, understand your exclusions and don’t pay for extras you don’t need.
Construction doesn’t wait for anyone, and neither do accidents. One storm, one theft or one mishap can put weeks of work, and thousands of dollars, at risk. That’s why having the right protection in place is essential. And for many builders and tradies, that means contract works insurance.
At All Trades Cover, we help Aussie builders, tradies, contractors and owner-builders secure the cover they need to keep projects on track. This guide explains what contract works insurance is, who needs it, what it protects, and how it helps you stay in control if the unexpected happens.
What is contract works insurance?
Contract works insurance is a type of construction insurance that covers a building project and its materials against loss, damage or unexpected events while it’s being built. It’s sometimes referred to as construction works insurance or contractors all-risk insurance. These are essentially just different names for the same protection.
Included events will depend on your policy, but most contract works insurance will step in to cover things like:
- Damage or loss of materials while they’re on-site.
- Fire, storm or other unexpected events that impact your project.
- Accidental injury or property damage caused to others during the build.
Without contract works insurance, a single accident or unexpected event could set your business back months. Or, worse, even put you out of business.
What does it cover (and not cover)?
Contract works insurance can protect a wide range of things, but every policy is slightly different. Here are the most common types of events and losses it covers, and the key exclusions you need to be aware of:
Commonly included
- Loss or damage to ongoing construction work (e.g., fire, storm, theft, vandalism).
- Damage to tools, equipment and materials.
- Natural disasters such as floods, bushfires, storms or earthquakes.
- Third-party property damage or injury linked to the project.
- Extra costs like debris removal or replacing tools.
Common exclusions
- Faulty design or workmanship.
- Normal wear and tear.
- Poor-quality or unsuitable materials.
- Anything specifically excluded by your policy.
This is exactly why using an experienced insurance broker is so important. They make sure you know exactly what’s included and what’s excluded before you sign.
Who needs contract works insurance?
If you’re responsible for a construction project, contract works insurance is a valuable safety net that you don’t want to overlook. It’s especially relevant for anyone in these groups:
- Builders managing large projects: Juggling multiple sites and high-value work means one accident or unexpected event could cost tens of thousands or halt progress entirely.
- Owner-builders and site managers: When your own money and reputation are on the line, having cover protects your investment and keeps your project on track.
- Contractors working under contract: If you provide tools, equipment or materials, insurance ensures you’re not left covering losses caused by damage or theft.
- Anyone unsure about the difference between public liability and contract works insurance: This policy covers the project itself, filling the gaps that public liability doesn’t.
What can happen without cover: A common scenario to think about
Imagine a small builder who only holds public liability insurance. After a major storm tears through their storage shed, around $40,000 worth of tools and materials are destroyed. Without contract works cover, they’re left to pay for the loss out of pocket, a costly setback that could take months to recover from.
This is exactly the kind of risk contract works insurance is designed to protect against.
Is contract works insurance mandatory?
FNot every project legally requires contract works insurance. In many cases, however, it’s treated as essential for getting the job done and protecting your business. Example situations include:
- Building contracts often specify it as a condition for the work.
- Lenders and banks may insist on it before approving finance for a project.
- Government or large-scale developments typically won’t accept a contractor without it.
What’s the difference between contract works and public liability insurance?
Although they’re both important for construction businesses, contract works and public liability insurance protect against different types of risk. Here’s what sets them apart:
| Contract Works Insurance | Public Liability Insurance |
|---|---|
| Protects the project itself, including works in progress. | Protects against injury or property damage caused to other people. |
| Covers a wide range of unexpected events that could damage your project or materials. | Covers claims made by clients, visitors or the general public. |
| Designed for builders, contractors, and project managers responsible for the work. | Essential for anyone whose work could affect others or their property. |
Why use an insurance broker like All Trades Cover?
Insurance can be complicated. Policies differ, exclusions catch people out, and it’s easy to end up underinsured. And it’s just as easy to get stuck paying for cover you don’t need. This is why builders and tradies rely on All Trades Cover.
We’re not your average insurance provider. We’re specialists in trades insurance. For more than 20 years, we’ve been helping Aussie builders, tradies and contractors get the right cover without the legal jargon, so they can focus on their projects, not the paperwork.
Here’s how we help:
- Tailored advice: Every business is different. We make sure your policy fits your work, your tools, and your risks.
- Trusted by thousands: Builders and tradies across Australia rely on us to get the cover they actually need.
- We fight for you: If something goes wrong, we ‘keep insurers honest’ and work hard to get claims paid quickly.
Keep your projects safe from nasty surprises
Construction is full of risks you can’t control. But protecting your projects doesn’t have to be one of them. With contract works insurance, your business is covered. Unexpected events won’t derail your projects, and your tools, materials and progress stay protected.
Get in touch with All Trades Cover today to make sure your next project has the right protection in place.
Frequently Asked Questions
- Does contract works insurance replace public liability insurance?
Not exactly. Public liability covers injury or property damage to others, while contract works protects your project, materials, and tools. Many businesses need both to be fully covered.
- How do I know if my policy has exclusions I should worry about?
Every policy has different exclusions. Common ones include faulty workmanship, normal wear and tear or poor-quality materials. A broker can review your policy and explain exactly what’s included, helping you avoid nasty surprises.
- Can contract works insurance save me money in the long run?
Absolutely. While it’s an upfront cost, having the right cover protects your business from expensive unexpected events that could otherwise halt a project or force you to pay out of pocket. In many cases, it prevents losses far greater than the policy cost.
