A sole trader has no company to stand between them and a claim, which is the whole reason this cover exists. If a customer is injured or their property is damaged because of your work, the claim is against you personally, and it reaches your own money. Public liability insurance answers for that, and for the legal costs of defending it, and it is the single policy most sole traders are asked to show before anybody lets them start.
Public liability insurance for self employed people trading in their own name
Public liability responds when a third party suffers injury or property damage in connection with your business, and it pays the compensation and the defence costs up to the limit you bought. For a sole trader the practical point is that the policy stands where a limited company would otherwise stand. There is no separate legal person to absorb the loss, so a claim that exceeds the limit reaches personal savings and, in principle, a home. That is why the limit chosen matters more to a sole trader than to a director of a small company, and why the cheapest limit on offer is not automatically the right one.
The limit is usually chosen for you
Most sole traders discover the limit they need from somebody else's paperwork. Domestic customers rarely ask. Letting agents, housing associations, main contractors, local authorities and shopping centres all do, and they name a figure: one million pounds is common for light domestic work, two million for larger domestic and commercial jobs, and five million for anything on a managed site. Buying the higher limit at the outset usually costs far less than the price of turning down the first job that requires it. Builders public liability insurance for self employed work on a managed site is therefore usually bought at five million. Market trader public liability insurance works the same way: the organiser names the limit as a condition of the pitch.
What self employed liability insurance does not cover
Public liability does not pay to redo your own defective work, does not answer for pure financial loss from advice, which is professional indemnity, and does not cover injury to your own employees, which is employers' liability and is compulsory as soon as you have any. It also does not cover your own tools, van or stock; those are property sections bought alongside. A sole trader policy quoted as one price usually bundles several of these, and the schedule is the only place that says which. A sole trader insurance comparison should check which of these each price includes.
How much is public liability insurance for a sole trader?
The insurers in the record on this site print starting prices for their business liability cover, and those figures describe the cheapest case an insurer will advertise: a single person, no employees, a low hazard trade, a modest limit and no claims. A sole trader with a van, power tools, work at height or a five million pound limit will be quoted a multiple of it. The value in the printed figure is not that it predicts your premium; it is that it is the number the insurer is prepared to stand behind in public, and several insurers will not print one at all. Insurers print starting prices rather than an average cost of public liability insurance, so a printed figure is a floor and not what a typical business pays. The cheapest sole trader insurance on offer is that advertised case, and it is cheap because of what it leaves out.
Questions people ask about public liability insurance for sole trader
Do I need public liability insurance as a sole trader?
No statute requires it. In practice it is required by contract: most commercial clients, agents, sites and public bodies will not engage a sole trader without it, and some local authority licences make it a condition. Employers' liability is different and is a legal requirement as soon as you employ anybody.
How much public liability cover should a sole trader have?
The figure is normally set by whoever you work for. One million pounds is the usual floor for domestic work, two million is common for commercial customers and five million is standard on managed construction sites. Check the contracts you want before you buy rather than after.
Does it cover me if I work at a customer's home?
Yes, that is the core of it: injury to the customer or damage to their property arising from your work. What it does not cover is the item you were working on itself, unless the policy carries a specific extension for damage to property in your care, custody or control.
Is public liability insurance tax deductible for a sole trader?
Business insurance premiums are normally an allowable expense where the cost is incurred wholly and exclusively for the business. Your accountant should confirm it against your own circumstances rather than a website.
How much is public liability insurance for self employed people in the UK?
It depends on the trade, the limit, the turnover and any staff more than on the insurer. The printed starting prices in the record on this site describe the cheapest case each insurer will advertise, and a self employed person with a van, power tools or a five million pound limit will be quoted a multiple of them.
How do I get public liability insurance quotes as a self employed person?
Start with the limit the contracts you want name, then describe the trade, any staff, the tools and van, and any work at height. Compare what each quote includes on the schedule, because a single price often bundles several covers and the cheapest leaves the most out.