Public Liability Insurance for Builders

Public liability insurance for builders pays compensation and legal costs if your work injures a member of the public or damages property that belongs to a client, a neighbour or anyone else, subject to the policy wording. Most builders need more than that: employers’ liability insurance is a legal requirement once you employ staff, and contract works cover deals with damage to the building you are working on before it is handed over.

What can go wrong on a building job?

Building work puts other people’s property and safety at risk every day. The realistic risks include:

• Digging foundations that undermine a neighbour’s wall, fence or outbuilding.
• Materials, tools or debris falling from scaffolding onto a passer by or a parked car.
• Striking an underground cable, gas pipe or water main while excavating.
• A fire caused by heat work, or by rubbish burning on site.
• Rain getting into a client’s home through an opened roof or wall.
• Disturbing asbestos during demolition or refurbishment.

On asbestos, HSE tells workers to take extra care where a building was built or refurbished before the year 2000, and says around 5,000 people die every year from asbestos related diseases. Some liability policies limit or exclude asbestos claims, so read the wording.

Example. Tom runs a small building firm with two employees and is building a single storey rear extension. While his team dig the footings close to the boundary, the neighbour’s old garden wall loses its support and collapses onto the neighbour’s summer house. The neighbour claims for a new wall and summer house. A week later one of Tom’s labourers injures his back lifting blocks. The neighbour’s claim falls under public liability and the labourer’s claim under employers’ liability, each subject to the policy terms. Without both covers, Tom would face two claims from his own funds.

Which covers fit a builder’s work?

Builders usually put together several covers. Which you need depends on whether you employ people, use subcontractors, hire in plant or take on design and build work.

Cover	What it deals with	Who it fits
Public liability	Injury to other people and damage to their property caused by your work	Every builder working in homes, businesses or on site
Employers’ liability	Compensation if an employee is injured or becomes ill because of the work they do for you	Compulsory once you employ staff, with cover of at least £5 million
Contract works	Damage to the works and materials on site before handover, for example from fire, storm or theft	Builders on extensions, refurbishments and new builds, and anyone whose contract asks for it
Own and hired in plant	Damage to or theft of plant and machinery you own or hire	Builders who use diggers, mixers, scaffolding or hired equipment
Tools and equipment	Theft of or damage to hand and power tools	Anyone who relies on their own kit
Professional indemnity	Claims that your design or advice was wrong and caused a financial loss	Builders who offer design and build or draw up plans

Our guides to public liability insurance, contractors all risks insurance and employers’ liability requirements explain each cover in more detail. GOV.UK says you do not need employers’ liability insurance if the only person you employ is a family member, such as a husband, wife, son or brother.

What will clients, councils and main contractors ask for?

Domestic clients may ask builders for proof of insurance, and their solicitor or architect may ask on their behalf. Councils, housing associations, schools and commercial clients may ask for public liability, employers’ liability and contract works cover before giving you work, sometimes with a minimum limit set out in the tender or contract. Main contractors may ask subcontracting builders for the same, and may ask to be named on your policy.

Read the insurance clause in any contract before you sign. Some contracts put the risk of damage to the works on you until handover, which is where contract works cover comes in. If a client asks for a higher limit than you hold, ask us to check the policy can be changed first. Our page on how much public liability insurance you need explains how limits are chosen.

How do CDM 2015 and site safety rules affect builders?

The Construction (Design and Management) Regulations 2015 apply to domestic jobs as well as commercial ones. HSE explains that a domestic client is anyone who has construction work carried out on their home, or the home of a family member. On a project with only one contractor, that contractor must take on the client’s legal duties. Where there is more than one contractor, the principal contractor takes on those duties, unless a principal designer has agreed in writing to do so.

HSE also says contractors must plan, manage and monitor their own work and their workers’ work, provide suitable welfare facilities from the start, and, where they are the only contractor, make sure a construction phase plan is drawn up before setting up the site. HSE says falls from height are one of the biggest causes of workplace fatalities and major injuries, and that a construction scaffold should be inspected by a competent person before first use and then every 7 days.

Insurers ask about these things because they affect how likely a claim is and how well it can be defended. Keep your risk assessments, plans, scaffold inspection records and photographs for every job.

Do builders who use subcontractors need extra cover?

Tell the insurer how many subcontractors you use, whether they supply only their labour or bring their own tools and materials, and whether they hold their own public and employers’ liability insurance. How each is treated under your policy depends on the policy wording and on who controls their work. Ask subcontractors for copies of their certificates before they start, and keep them on file. If you pay subcontractors under the Construction Industry Scheme, your records will already show who worked for you and when.

What drives the price of cover for a builder?

• The type of work: maintenance, extensions, loft conversions, structural work, new builds, demolition or basement work.
• Maximum depth of excavation and maximum height of work.
• Any heat work, and whether you work on roofs.
• The limit of indemnity you choose for each claim.
• Your turnover, wage roll and use of labour only and bona fide subcontractors.
• The value of contracts and the plant you own or hire.
• Your claims history and how long you have been trading.
• The excess you agree to pay.

What should you have ready when you ask for a quote?

• Your business name, trading status and years trading.
• A description of the work you do and the split between domestic and commercial jobs.
• Estimated turnover, wages and subcontractor payments for the next 12 months.
• The largest contract value you expect to take on, and the value of plant and tools.
• Maximum depth and height you work at, and whether you do heat work or demolition.
• The limits your clients or contracts ask for.
• Any claims or incidents in the last five years, including those that did not lead to a payment.

Answer every question fully. Section 3 of the Insurance Act 2015 requires a business to make a fair presentation of the risk before the policy starts, including every material circumstance it knows or ought to know. Solar Protect is an FCA authorised insurance broker: ask us for a quote and we will look for cover that fits your work, or call 01795 841 310, Monday to Friday 9am to 5pm.

Frequently asked questions

Does public liability cover damage to the building I am working on?

Contract works cover is the cover designed for damage to the works themselves before handover. Whether public liability responds to that kind of damage depends on the policy wording. See our page on whether public liability covers damage to client property.

What happens if I employ someone without employers’ liability insurance?

GOV.UK says you can be fined £2,500 for every day you are not properly insured, and could be fined £1,000 if you do not display your certificate where employees can see it.

Can I do roofing work under a builder’s policy?

Only if the insurer knows and agrees. Roof work is a higher risk activity, so describe it fully when you apply. Our page for roofers explains how insurers look at work on roofs.

Do I need cover if I only do small repairs?

The risks are smaller but still real: a dropped tool, a flooded kitchen or a tripped customer can lead to a claim. Clients and letting agents may also ask for proof of cover whatever the size of the job.

Sources

• GOV.UK: Employers liability insurance
• HSE: Workers
• legislation.gov.uk: 3
• HSE: Domestic clients
• HSE: Contractors
• HSE: Faq height
• HSE: Indg401

Reviewed by Christine Anderson, Broker, Solar Protect. Last reviewed 10 November 2026. Solar Protect is the trading name of Solar Insurance Services (Medway) Limited, authorised and regulated by the Financial Conduct Authority. This page is general information, not personal advice.