A sole trader and their business are the same legal person, and that single fact shapes every insurance decision that follows. There is no company to absorb a claim, no separate balance sheet and no limited liability; a judgment against the business is a judgment against you. Sole trader insurance is the set of covers that puts something between a claim and your own money, and the right set is smaller and cheaper than most people expect.
What sole trader liability insurance covers
Public liability is the first policy almost every sole trader buys, because it answers for injury to other people and damage to their property, and because customers and clients ask for it. If you advise rather than make or fix, professional indemnity matters more, since the loss a client suffers from bad advice is financial rather than physical. Most sole traders need one of these two clearly and sometimes both, and the honest way to decide is to ask what a dissatisfied customer would actually be claiming for.
Sole trader public liability insurance requirements and the law
Almost nothing, until you employ somebody. Employers' liability becomes compulsory under the 1969 Act as soon as there are employees, and that includes part time and casual staff. Motor insurance is compulsory for any vehicle used on the road, and a van used for business needs business use on the policy rather than social and domestic. Beyond those two, a sole trader's insurance is decided by contracts and common sense rather than by statute. So sole trader public liability insurance requirements come from contracts and licences, not from statute, and sole trader van insurance has to carry business use.
Your own things are a separate question
Liability policies protect other people. Your tools, laptop, stock, camera or equipment need their own section, and it is usually rated on a declared value with a limit for any one item. Sole traders frequently assume a home contents policy will cover equipment used for work; it usually excludes business use, and the exclusion is discovered after the theft rather than before. Working from home is itself worth telling the household insurer about.
Reading a package quote
The public liability insurance sole traders buy is usually sold in a package, and the headline price attaches to a particular combination: a limit, an excess, a declared turnover and a trade description. Two quotes that look different are often quoting different things. The useful comparison is section by section, and the printed starting prices in the record on this site are a floor for the liability half rather than a prediction of any particular quote. The cheapest sole trader insurance quote is often the one with the lowest limit or the fewest sections, so compare like with like.
Questions people ask about sole trader insurance
What insurance does a sole trader need in the UK?
Public liability if customers, clients or the public are exposed to your work; professional indemnity if people rely on your advice; employers' liability, which is compulsory, if you employ anybody; equipment or tools cover for the things you earn with; and business use on your vehicle insurance if you drive for work.
Is insurance a legal requirement for a sole trader?
Only employers' liability, and only with employees, plus the usual motor insurance duty for any vehicle used on the road. Everything else is a commercial decision, though many customers and licences make public liability a practical requirement.
Does a sole trader need insurance with no employees?
There is no legal duty to insure without employees, but the exposure is larger, not smaller: with no company between you and a claim, an uninsured judgment reaches your personal assets. That is the argument for sole trader public liability insurance even when nobody has asked for it.
Is sole trader insurance cheaper than company insurance?
Often slightly, because the employers' liability section is usually absent and turnover is smaller. The structure of the business matters less to an underwriter than the trade, the turnover, the staff and the limit chosen.
Do I need employers' liability insurance as a sole trader?
Only once you employ somebody, including part time and casual staff, and from then it is compulsory under the 1969 Act. A sole trader working alone has no duty to hold it, though some client contracts ask for it anyway.
How much does sole trader insurance cost?
UK insurers and brokers that print a small business price start from £5 to £7 a month, read on 29 October 2026. Those are floors for the liability half; your trade, turnover and the limit you choose set the real figure.
Do sole traders need public liability and professional indemnity insurance?
Public liability if customers or the public are exposed to your work, professional indemnity if people rely on your advice, and both if you do both. Ask what a dissatisfied customer would actually be claiming for.
Can I get liability insurance as a sole trader?
Yes. Public liability and professional indemnity are written for sole traders in their own name, usually as sections of a package priced on your trade, turnover and limit.
What type of liability does a sole trader have?
Unlimited personal liability. A sole trader and the business are the same legal person, so a judgment against the business is a judgment against you and can reach your personal assets.