Key Takeaways:
- Public liability insurance protects builders from third-party injuries, property damage, and legal claims caused by your work.
- Contract works insurance covers the building project itself, including materials, incomplete work and damage during construction.
- Most builders need both: public liability protects you from claims, while contract works insurance protects the job.
- Having the right cover is essential for licensing, quoting and stepping onto most job sites in Australia.
- Going without cover exposes you to paying large claims, legal fees, or being blocked from work.
- All Trades Cover helps builders get tailored insurance, fast quotes and real tradie support without the runaround.
If you’re a builder working in Australia, chances are you’ve been asked for a certificate of currency more than once, whether it’s to quote for a job, renew your licence, or step foot on-site.
But if you’ve ever wondered what public liability insurance actually covers, how much you need, or what happens if you don’t have it, you’re in the right place.
This guide breaks it all down for you, in plain terms, so you can protect your business, stay compliant, and get back to doing what you do best.
What is public liability insurance (for builders)?
Public liability insurance protects you when things go sideways on-site, whether it’s something you did, something one of your team did, or just a freak accident that no one saw coming. It’s designed to provide cover if your business activities result in:
- Injury to a third party, such as a client, visitor or passer-by
- Damage to someone else’s property
- Legal costs if a claim is made against you
Basically, public liability insurance is there to protect your back pocket when things don’t go to plan. Even on the best-run sites, accidents can still happen. And when they do, liability cover helps make sure your business isn’t left footing the bill.
Do builders need public liability insurance?
Short answer? Yep, absolutely. If you’re a licensed builder in Australia, public liability insurance isn’t just another compliance box to tick. It’s your ticket onto the job site and your shield when things go wrong.
Here’s why you can’t skip it:
- Proof of cover is usually part of your licence application: Want your builder’s licence approved? You’ll need to show proof of cover. Bodies like NSW Fair Trading or QBCC won’t process your application without it.
- You’ll need it to win jobs: Most councils, commercial clients and developers won’t even look at your quote unless you’ve got a Certificate of Currency in hand. Basically, no insurance, no deal.
- It’s required to step foot on site: Head contractors aren’t taking chances, so if you’re not insured, you’re not stepping foot on site. Simple as that.
- It saves your backside when things go wrong: Crack a pipe. Scratch a neighbour’s car. Someone trips over your gear. You could be staring down a claim for tens, or even hundreds, of thousands. Public liability keeps the costs off your back and your business running.
What happens if you don’t have public liability insurance?
You might think, ‘She’ll be right’, until she’s not. Skip the cover, and it might all seem fine… right up until something hits the fan. Here’s what you’re risking:
- You could be paying out of your own pocket: If someone cops an injury or you accidentally damage something on site, even if it’s a total fluke, you could be on the hook personally. No cover means your cash, your assets, your stress.
- You could lose your licence: Licensing bodies in most states expect you to have public liability insurance. No proof of cover? You’re staring down suspension or a blocked renewal. No licence = no work.
- You could miss out on jobs, or get booted off site: Big clients, councils and site supervisors don’t muck around with uninsured builders. No insurance = no quote considered, and in some cases, no entry past the site gate.
- Legal bills? That’s all you, mate: Even if the claim’s dodgy, you’ll still need a lawyer. And that isn’t cheap. Without insurance, you’re paying those legal fees straight from your own back pocket.
What does public liability cover (and not cover)?
Alright, so you know why you need it. Now here’s what public liability insurance actually covers (and what it doesn’t):
What’s covered:
- Injury or death to third parties: If someone cops an injury on-site, like a client, tradie, subcontractor or even a passer-by, and it’s linked to your work, public liability steps in.
- Damage to someone else’s property: This includes accidents like cracked tiles, smashed windows, burst pipes or damage caused by falling tools or machinery.
- Legal defence costs: Get slapped with a claim? Even if it’s not your fault, liability cover helps with the legal bills. Lawyers aren’t cheap, so this saves your bacon.
- On-site accidents related to your work: If your tools, materials or job-site setup cause an accident, you’re protected. Think gear falling, slippery surfaces, or general chaos on site.
What’s not covered:
- Injuries to you or your workers: If you or your workers get hurt, that’s a Workers Comp situation. And if you’ve got employees, it’s legally required. Different cover, different policy, no way around it.
- Loss or damage to your own tools or gear: Public liability only covers third-party property. For your own stuff, you’ll want General Property (Tools) Insurance.
- Faulty workmanship or incorrect advice: Public liability may cover damage caused to someone else’s property by a mistake on-site, but it won’t cover the cost to fix your own errors or mistakes in your professional advice. That’s where Professional Indemnity insurance comes in.
- Contractual disputes, delays or poor project management: Public liability won’t cover claims related to late completion or disagreements over scope of work.
Public liability vs. Contract works insurance — What’s the difference?
If you’re a builder running full projects, it’s easy to get your insurance types mixed up. Public liability and contract works insurance cover very different risks, and relying on one thinking it does the job of the other is a fast track to underinsurance. So let’s take a closer look at their differences:
Public liability insurance
This is the one that protects you if someone else gets hurt or their property is damaged because of your work. Think of it as covering your back pocket for accidents that involve other people.
Example: A scaffold topples onto a neighbour’s car, or a client trips over materials left on-site. Public liability steps in to cover claims for injury or property damage.
Contract works insurance
This covers the project itself (the building, materials and work in progress) against damage during construction. It’s all about protecting the job you’re building, not third parties.
Example: A sudden storm floods your site mid-build and half the frame is ruined. Contract works insurance covers the repair or rebuild costs so you’re not paying for it out of pocket.
The simple rule of thumb
- Public liability protects you from claims made by others.
- Contract works insurance protects the job itself while it’s underway.
Most builders, especially those managing subcontractors or full residential/commercial projects, need both. One covers your legal exposure, while the other covers the asset you’re building. When paired together, they keep your business and your projects protected.
How much public liability cover do you need?
The amount of cover you need depends on the kind of jobs you take on, who you’re working with, and what the contract or site manager expects.
Here’s a guide to help you work it out:
Lower-level cover (around $5 million)
Often suits subbies or tradies on smaller, low-risk residential jobs. This level is usually the minimum required by most licensing bodies and smaller contracts.
Mid-level cover (around $10 million)
A solid choice for licensed builders running their own sites or working across multiple jobs. This level of cover is commonly expected on larger residential or light commercial projects.
Higher-level cover (up to $20 million)
Typically required for government contracts, Tier 1 commercial sites, or major infrastructure projects. If you’re quoting on public tenders or anything with big risk or big value, you’ll likely need this level of cover.
Why go with ATC for public liability insurance?
We’re not here to flog you some off-the-shelf policy from behind a call centre desk. We’re trades insurance specialists who know the game and keep you covered. Our team includes former builders, sparkies and mining contractors who have actually been on the tools.
We know what can go wrong on site, what cover actually holds up, and how to keep insurers honest when sh*t hits the fan.
Here’s why thousands of Aussie tradies back ATC:
- Tailored cover for builders: We don’t sell generic policies. We match your cover to the real risks of your trade, whether you’re a solo operator or running a full crew.
- Real people and real support: You get direct access to a dedicated team who knows your name, understands your work, and picks up the phone when it matters.
- We shop around so you don’t have to: We compare cover from top Aussie insurers, so that you get more options, better protection, and no overpriced nonsense.
- We fight for you at claim time: When things go south, we go to bat for you. We’ll handle the paperwork, deal with the insurer, and make sure you’re not getting stitched up.
Get the right cover, without the runaround
Still asking the question: do builders need public liability insurance? To sum it up, if you’re quoting, building or managing a crew, the answer is yes.
And so now’s the time to sort it properly. Whether you’re renewing, upgrading or starting from scratch, we’ll help you get the cover you actually need, and nothing you don’t.
Request a quote online or give us a bell on 1300 826 850. We’ll walk you through it, no jargon, no pressure. Just solid advice from a team who gets it.
Frequently asked questions
- Is public liability insurance tax-deductible for builders?
Yes. In most cases, public liability insurance is considered a business expense and is tax-deductible. Always speak to your accountant to confirm what applies to your situation.
- How quickly can I get a certificate of currency?
Once your policy is arranged and payment is confirmed, you can usually receive your certificate of currency on the same day, often within a few hours.
- Can I get public liability insurance as a sole trader or subcontractor?
Absolutely. Whether you’re a sole trader, subcontractor, or running a larger crew, public liability insurance can be tailored to suit your business structure and the work you take on.
