Plumbers insurance

Why do plumbers need business insurance? 

Whether you’re a sole trader or a team of many, there are several inherent risks that come with being a plumber. From minor damage to someone’s bathroom floor to major system failures that affect an entire sewage system, you’re facing the possibility of running into trouble every day. 

Business insurance can offer plumbers a financial buffer if something does go wrong. Business insurance is a catch-all term for the many types of insurance that may be relevant to you as a plumber, including public liability, portable equipment and personal accident and illness insurance. 

Taking out business insurance puts you in a better position to cover unexpected expenses that may crop up as a result of accidents, theft, damage, legal claims and business interruption. 

What kind of business insurance products may be relevant for plumbers? 

There are a few different kinds of business insurance to consider, including: 

Public liability insurance 

If a member of the public – say a client whose home you’re visiting – is injured or has their property damaged and your plumbing business is found responsible, public liability insurance could help cover medical fees, repairs or replacement, and other costs associated with the claim. 

That ruptured water pipe scenario we mentioned earlier is just one example of where Public Liability insurance comes in. Another instance could be if a client slipped on the wet floor and injured their back. 

Portable equipment insurance 

It probably goes without saying that as a plumber, your tools are some of your most important assets. So, what happens if they’re stolen, lost or damaged? 

Without portable equipment insurance (an optional part of a business insurance package), you might be facing some pretty hefty expenses to replace your toolkit. But with insurance, you could have all or part of the cost covered. 

Personal accident and illness insurance 

This one’s especially worth considering if you’re a sole trader and your plumbing business relies on your labour to function. 

If you get sick or injured while you’re at work, or even outside it, personal accident and illness insurance can help cover your income and possibly even your business expenses until you’re back on your feet. 

Is business insurance mandatory for plumbers? 

It depends. Some insurance is completely optional – like portable equipment. But you may have to take out other types of insurance before you can legally do any work. 

One such policy is public liability insurance, which is required for licensed plumbers in Victoria under the Licensed Plumbers General Insurance Order 2002 (Vic). Victorian plumbers need plumbers warranty insurance to cover any work defects too, but usually this can be added to a public liability insurance policy. 

Public liability insurance and product liability insurance are also must-haves for plumbers who want to contract in Tasmania and who hold a license from another state or territory.  

No matter where you are in Australia, you might be required to take out public liability insurance if you’re undertaking certain jobs, like large-scale commercial projects or government contracts. 

If you have employees, apprentices or subcontractors, Workers’ Compensation* is another non-negotiable insurance. You’ll need it to cover your staff in case they get injured or sick on the job.  

*(Please note BizCover does not offer Workers’ Compensation insurance.) 

Factors to consider when deciding what cover you need 

No one wants to get caught out with inadequate insurance coverage, least of all when you’re busy keeping everyone’s pipes flowing smoothly. That’s why it’s crucial to ensure you get the right amount of cover. Some of the things to think about include: 

• The nature of your work: If you’re only doing domestic plumbing jobs for instance, you might not need as much coverage as someone working on industrial or commercial projects
• The size of your business: Sole traders may need less insurance than plumbing businesses with multiple employees, simply because they’ve got less exposure to potential claims
• The value of your tools and equipment: You might have a smaller toolkit with wrenches and pipe cutters, or a larger one that extends to high-tech pipe inspection cameras
• Your exposure to risk: While certain risks are relevant to every plumber (clogged loos, anyone?) there may be some that are only faced by a few, like dealing with hazardous waste or navigating complex mazes of commercial pipe systems
• Policy exclusions: Make sure you’re across what different policies won’t cover, like certain kinds of damage or specific high-risk activities 

How much insurance does your business need? 

Here’s an example of how insurance costs can vary. Consider two plumbers – one who does small residential jobs and another who takes on big commercial projects.  

The former has fairly basic insurance needs because they only interact with clients in their homes. The latter works on massive job sites where there are tradespeople, passersby and other members of the public coming and going, along with the potential for much higher property damage costs. 

Each plumber will probably choose different amounts of public liability cover that match their individual levels of risk. 

Helpful tip from BizCover

Think business insurance is a ‘set and forget’ solution? Think again! It’s best to review your insurance needs at least annually, or every time your plumbing business goes through a change – like if you hire more staff or add new (and expensive) equipment to your toolkit.  Assess each job individually to determine the necessary coverage, too – there may be a bigger or different scope of work than you’ve done previously, which could require more coverage.

Jane Mason

Former Head of Product, Channels & Risk at BizCover

How much does business insurance for plumbers cost? 

Every plumber will typically pay a different amount for insurance – simply because each and every policy is different.  

When they’re assessing your premiums (i.e. the cost), insurance providers will usually look at your business size, the kind of plumbing work you do, the value of your tools and equipment, the unique risks your business faces, and even your location. Each of these factors affects the likelihood and potential cost of a claim. 

Other variables like policy add-ons, coverage limits and claims history can also impact the price you pay.  

If you want to lower your premiums, you could consider going for a higher excess (the out-of-pocket expense you pay before insurance kicks in), bundling your policies and shopping around before committing to an insurance provider. 

Where can I find and compare business insurance?

Luckily, you can do that last part with iSelect! In partnership with BizCover, we’ve put together a useful business insurance comparison tool that lets you compare quotes from several of Australia’s leading insurance providers.