Handyman Insurance fixed with proper cover that saves money

If you are reading this, chances are you have the same questions in your mind as many of our other Tradie friends and customers.

These questions once answered help you do the “Right Thing.”

Right thing by our business to make sure it thrives.

Right things for our families to make sure you have looked after them properly by taking the right steps and making the right decisions.

Right thing for our communities and last but not the least, right thing by the insurers too.

As much as there are occasional cases of people giving fraudulent information to insurers for the purpose of making a financial gain, predominantly people are super honest.

They want to provide full disclosure to the insurer to make sure that at time of a claim, they actually are not seen as someone will-fully avoiding their duty of disclosure.

You just want to do the right thing, get the right insurance and get on with your money making activities.

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PERFECT…

The rest of the information on this page helps you achieve just that.

You’ll learn the answers the main questions in your mind which will increase your knowledge.

And higher knowledge results in the Right decisions.

The main questions we get asked all the time…

• What is Handyman Insurance?
• What insurances does a handyman need?
• How much does Handyman Insurance cost?

Let’s look at these one by one.

What is Handyman Insurance?

You won’t find a standard Handyman Insurance definition anywhere in the world. To be honest, there is no such thing as Handyman Insurance. It’s only a general term used by many tradies who often are referring to Public Liability Insurance.

If you do work for realestate agents and property managers, they would usually ask for a certificate of your Public Liability Insurance before they allocate you any jobs.

At CoverTradie, our definition of Handyman Insurance is a bit broader than just the Public Liability Insurance.

If it’s just a general term that represents insurance to cover Handyman business, it needs to be cover all aspects of Handyman business and the way we see it is, is that you have 3 types or risks.

• Personal Risk – Risk of personal injury or illness to a handyman
• Asset Risk – Protecting your assets like your vehicles, stock and tools etc. This part includes cover for:
  • Commercial Vehicle Insurance
  • Tools Insurance
  • Property Insurance (Usually only taken by large handyman/property maintenance businesses)
• Business Risk – Risk of a financial claim made against you for damage to someone’s property or causing an injury.

Handymen need holistic coverage that protects them against a range of risks!

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Handyman Insurance – Managing Personal Risk

People get into business to be able to earn themselves a good living and do the things they want to and enjoy life.

Whether we like it or not, there’s always a risk of us getting injured or becoming ill which can come in the way of us and a good life.

Why is this important? Because Trades and Construction workers have the highest rates of injuries out of any occupation class in Australia.

Not only that, Tradies are also pretty active, they play sport, go out fishing, hiking etc. Injuries happen outside of work too.

Fortunately, there Personal Accident & Sickness Insurance!

Personal Accident & Sickness Insurance protects your income or cash flow for a period of time usually 1-2 years if you got injured and optionally if you got sick and are unable to work.

This could be due to an injury sustained at work or outside of work. It could be whilst you are out playing footy or fractured your leg during a hiking trip.

WorkCover doesn’t cover you for any injuries sustained that are not work related.

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In simple terms, you can get insurance against personal injury that pays you say a $1000 per week for a period of 52 weeks (1 year) for about $60 per month.

That is less than a cup of coffee a day and usually tax deductible also but perhaps you should seek tax advice from an accountant not us.

It’s an important cover and often people ignore this risk because the think injuries happen to other people not us. We think it’s very important because if you are not there, your business is not there too.

Handyman Insurance – Managing Asset Risk

For most handymen, their two types of business assets are the vehicle they use and the tools and perhaps some minor stock items, the regular consumables etc. in there.

Commercial Vehicle Insurance

It’s not uncommon for Tradies to have their vehicles on finance. You may not know but out of all insurance classes, Motor Vehicles have the highest rate of claims or what we call it in the insurance world – “high claims frequency rate”.

These claims relate to accidents, big and small. Sometimes minor bingles around shopping centre car parks, other times serious accidents on freeways.

The more a vehicle is on the road, the higher the chance of a claim.

Since handymen are on the road all the time, running around from one job to the other, there are frequent accidents and claims.

There are a range of factors that determine the price of commercial vehicle insurance like age or driver, postcode of garaging address, type of vehicle, make of vehicle, value of vehicle etc.

Important things to keep in mind:

• Let the insurer know that you use vehicle for business and not personal. You will pay more for insurance but you have declared the risk correctly
• Include the value of accessories in your sum-insured or list them out like drawers, shelving and vehicle signage
• Insure on agreed value if you can.

Never be un-insured even if your vehicle is not worth insuring comprehensively.

Get third party cover if nothing else. You don’t want to be in an accident damaging a Lamborghini and be in a situation to pay the bill yourself because you were un-insured.

Tools Insurance

Ever wondered what is the total value of the tools you may have? Have you recently bought a Makita kit that is worth $1400? Can some of the items be stolen easily given there is a big market for stolen tools?

It is easy to have $10,000 to $20,000 worth of tools in a van. We’ve seen it a few times where our tradie clients have underestimated what they own but sit down and do a tally and you’d soon find out what we mean.

Tools Insurance protects your tools from accidental loss or damage but the most frequent reason for claims is Tool Theft.

It happens a lot at worksites and people have reported thieves trying to pry open tool boxes from the back of utes or smashed van windows to pick up easy to take and sell items.

Mostly cordless drills and most tradies use quality tools like Makita, Milwaukee etc. not cheap as ones you get from some supermarkets.

Clever Handymen look after their tools but when bad luck strikes, there is tools insurance. You should definitely consider Tools Insurance.

Tools Insurance starts from $40 per month.

Handyman Insurance – Managing Business Risk

When we say Business Risk, we mean your business being asked to cover costs for damages to someone’s property or injury to someone. Let’s look at an example each for Property Damage & Injury to someone risks:

Risk of damage to property belonging to others

Let’s say you were at a job replacing some damaged plaster at your customer’s residence. The customers are very well off and you notice beautiful furniture and furnishings in their property.

You’ve done the job to a great standard as you always do but as you were finishing your work and moving your aluminium ladder through the narrow hallway, you’ve knocked an expensive vase off the the mantel shelf. Shattering it into tiny pieces, beyond repair!

The customer is unhappy, it had sentimental value, it was an antique and all sort of emotions come into the conversation. The property manager who had sent you there to do the job is also unhappy but somehow you’ve explained its was an accident.

After all that needs to be said is said, the bill still needs to be paid. A replacement vase, similar to that costs more than $6000 and since it was a small job, you were hardly going to make $200 from it, the end result is a big financial loss because the customer is now demanding you pay them.

Don’t worry, that’s where your public liability insurance comes into play. You’ve damaged someone’s property and the loss is covered by your insurance.

Risk of injury to others

Okay, same clients, beautiful home, elderly couple in their late 80s who are quite well off but a little frail and weak. You’d gone their to make some minor repairs to one of their bedroom doors which doesn’t close as well as it should.

You notice this is only a small issue and perhaps only needs tightening of hinges but the screw driver is in the ute outside.

As you’ve gone out to grab it, you’ve left the tool box there only. The dark passage way meant that the elderly lady of the home didn’t quite see it and has tripped over landing on her elbow. Boom!

Big trouble, the next minute you are trying to ring the ambulance to help the poor lady out. Later you’ve got a call from her son who is a big town lawyer saying that you were responsible for her injury and the bills to manage that would be god knows how much.

In a situation like this, Public Liability Insurance comes handy. There are less of these type of claims but when they are, the amount paid is very high. Even insurers are scared of claims like these, do not try to wing this.

Do not operate your business without the right Public Liability Insurance.

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How much does Handyman Insurance cost?

This is often a question on top of mind for all of us and rightly, it should be. We all want to make the right purchase decision.

Experience has taught us all that a little bit of shopping around can be quite helpful in finding a competitive price for anything that we want to buy.

And that includes insurance too.

There are many commercial insurers in Australia, all wanting to win business by identifying risks and pricing insurance.

Their goal is to estimate the likely cost of claims if they insure you and then add a profit margin in hope that they make some money.

The profit margin is pretty standard across insurers but the real driver of the pricing difference in insurance companies is their assessment of risk, your risk.

If they over estimate your risk, then chances are they price themselves out of the market. If they underestimate the risk, they the stand to make a loss.

Like us small business owners, they are trying to do the same thing but at a greater scale and our experience tells us that they often get it wrong also.

These mistakes in judgement creates the opportunity to find a good deal for yourself. As we are across the pricing of these insurers, we can easily spot which insurer is keen to do business for your occupation class with the least amount of exclusions.

Using our market insights, we can find a deal for you which would be very difficult if not impossible for you to find.

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Enough with the explanation as to why, let’s talk about actual cost of Handyman Public Liability Insurance.

Handymen pay one of the lowest rates for their Public Liability Insurance when compared to other common trades, because the number of claims generated by your occupation group is low. See below:

And the interesting thing is that the prices for Handyman Insurance do not vary much from state to state. See the chart below:

Many people start off with $5 Million liability cover but realise that often they need higher coverage limits. Particularly if you work with other businesses, they may ask for a $10 million or a $20 million limit for your liability coverage.

In which case the table below gives a picture of what to expect should you need higher coverage. Along with the the lowest prices that we observed, you have the averages and the highest values also.

For a small business with a turnover of $100,000, you can expect the premiums to jump by about $100 between limit increase from $5 Million to $10 Million to $20 Million.

So there is an increase but not a huge deal. Sometimes it’s just worth getting a higher limit upfront if you know the bulk of your work is going to come from being a subcontractor to other large businesses.

You may then be wondering how does this all affect me as I am not a business with a $100,000 turnover but with a higher turnover.

Well, as your business size grows, so does the risk increase in your business. The way the insurers see this is that a growing business means that the attention of the business owner is stretched and spread across many things.

Plus, there may be staff working for you who are still under training and instructions. They may not be able to do the job at the same quality level as you do.

As you would understand that this drives the risk level up and also the cost of insurance. See below:

Pay close attention to the chart above, there is a step jump in premiums from turnover of $200K to $300K. Which aligns with what we’ve said above.

Its really when the turnover enters the $300,000 territory, it’s when business owners put on new staff and that’s where the possibility of a claim happening increases. Hence why its important to know which insurers increase their premiums when.

You need someone with a pretty sharp eye for detail to know that, something that we can help with.

The alternative is that you rely insurance broker who talks more than they actually do and is happy to get you the averagely priced insurance.

We’ve seen customers who have been happy to average priced insurances. We kind of understand why that may be the case. Its perhaps human nature to compare and be comfortable that what they are paying is what everyone else is paying too.

No a great way to be in our view. That money is better in your pocket than the pocket of your insurance company or even your insurance broker.

Below is a great example of what we mean. Let’s take an example, say you are a business who is doing really well and has a turnover of $500,000. You’ve got a few staff members generating good quality work and income.

We’ve seen that if you are on a lowest possible rate, you could be paying lower premiums compared to a business with a $300,000 turnover on average rates. The chart below shows just that.

There is no argument against the fact that a well researched person will be able to make better decisions. In the case of insurance, we work with Tradies only hence it allows us to pay close attention to many things that others overlook.

We are pretty keen to drive a good deal for your insurance and making sure that you are fully covered. Give us a call and see how we may be able to help you.

We wish you all the best for your business.