Insurance for a painter and decorator, contractor. Are you covered?
We were all rocked to our roots recently when one of our colleagues suffered a serious illness. Early 40’s, young family, lots going on, but one doctor’s visit, and it was all change. Several months off work, no income.
The medical prognosis is positive, and medical costs are covered by the NHS, but any time off work due to illness and accidents, or setbacks to your business that seem to come from nowhere, can put great and sudden stress not just on your business and household finances, but on the family.
Needless to say, it was a sobering time, but there was a lesson there. I went beavering for information on the options to better protect ourselves against the myriad unforeseens that can trip up any self-employed painter and decorator.
When it is time to get educated, we need a teacher.
Trusted insurance advice from Boothby Taylor
Boothby Taylor are insurance brokers authorised and regulated by the Financial Conduct Authority and Aaron and Lee share the “teach not sell” attitude that I promote on Traditional Painter.
They really know their business, and I was impressed with the clarity of the information they gave me on insurance cover across the board, from accident cover to insurance against website hackers and legal challenges from mischievous 3rd parties. Easy to digest information, and surprisingly affordable basics. And a bit of myth busting too about budget online insurance quotes.
As a business, Boothby Taylor are all about the value, and have collated a portfolio of what they believe to be the best value policies for our trade. They boast a very reasonably priced £1m Public liability insurance for decorators which meets the requirements, whereas the van insurance providers they recommend charge a bit more than the budget insurers, but they have been winning awards for years as the best claims settlers in the business.
Simply Business are our main competitor in terms of generic basic tradesman insurance. They work via call centres. With us, you get your own personal account handler from the moment of enquiry, we never ignore emails or phone calls, and we beat 99% of Simply Business’ quotes anyway. It’s just Simply Business pay much more for advertising, and we rely on referrals and recommendations.
If your readers have an alternative quote with Simply Business, tell them to speak to us and we will make sure they get the best deal possible.
Any questions, please get in touch.
So, I will stand aside, and what follows is Lee’s unambiguous run down of what a painter, decorator and contractor needs to know about insurance. Please post more questions in comments, or contact Lee and Aaron direct.
Personal accident policy provides a range of financial benefits for you and/or your employees in the event of an accident or injury. Cover is available for individuals or as a group policy.
This is a big one for us, falling off ladders is a big ruiner of careers.Indeed. Aaron has included costs for this within the public liability policy but we do have more bespoke offerings.
Public Liability – £1,000,000 -£10,000,000
This insurance protects against your legal liability for accidental bodily injury to, or accidental damage to the property of members or the public caused in the course of the business.
Are there any excess sums in a claim?
– Excess’ for trades can vary. Most are set at £250 but an insurer could increase this if the trade is “riskier” or includes heat work £500 for heat.
How do I make a claim, if for instance, I did spill paint over someone’s carpet and ruined it?
– Every claim should be reported to the insurer/broker as soon as possible so that they can help you to settle the claim quickly. An emergency number is provided and you can discuss potential claims with the broker to see how they should pan out. The claim handler will take the details over the phone and may send out a claim form.
Do I have to compensate the client up front and then claim? How does that work?
-You shouldn’t make any payments to claimants, unless authorised to do so by the insurer, as it could prejudice your position. By making a payment you are effectively admitting responsibility. Paying the client directly for a smaller claim can easily lead to larger claims being made against you, even though you may not be at fault.
Do I need to send in photos, or a report? How long does it take to get a claim sorted?
– Every claim is different and some can be quite complex, so there are no set time scales. A claim form will request all of the information you need to send to the claims handler and in some cases an assessor will be sent out to assess the full extent of the damage. You should always take photographs of accidents and incidents as they can help the insurer claim back monies paid out. Cases involving theft should always be reported to the police.
If the claim is a straight forward like the theft of tools from the back of a van, and you can supply the insurer with receipts or invoices, then there’s no reason why a claim can’t be settled within 7-10 days. Claims involving employees will take longer as insurers need to look at long terms effects of injury.
Are decorators covered for removing radiators during the course of wallpapering and painting work?
I and the insurer would regard this as a normal activity for a painter and decorator. If I paid for somebody to paint my house and it hadn’t been done then I’d feel a little hard done by (although it’s ok when I leave it).
I think that anyone saying that it isn’t covered has been badly advised or their policy is far too restrictive. If it’s the latter then I expect it’s a policy bought through a large direct insurer that doesn’t understand the trade.
What is the cost to make sure you are covered to drop rads as part of wallpapering jobs for instance?
I’ve checked the wording and with the insurer and they are happy that this would be standard procedure. Cover would be provided under our policy.
Do you have case studies, or examples of recent claims so we could gauge how this insurance works?
Theft of plant – Keep your receipts
A groundwork contractor suffered a theft from their lock up compound, resulting in the loss of all tools and some heavy plant. The tools were the client’s livelihood and without them couldn’t trade. The client contacted Boothby Taylor who then contacted the insurer. The insurer was made aware that the tools needed to be replaced as soon as possible, to get the client up and trading.
The usual claim time-scale for contractors’ All Risks and Plant claims is between two and four weeks. We worked with the insurer to get a claims assessor out to see the client on the day after. The client had a good inventory of the items, along with receipts showing their ages; with this the insurer could make very accurate valuations on the items and agree the values with the client.
Within one week the client had received a cheque from insurers for £37,500.
Public Liability – Take photos
Our client set up a barrier system to divert members of the public away from their area of work. It was seen that a large number of people were ignoring signs and pushing through the barriers to take their regular short cut. One member of the public pushed through the barriers and tripped on the pathway being laid. They got up and said they were going to claim against the company.
Our client had taken photos recording people walking through the barriers and other photos showing the signs diverting people. Our insurer agreed that they would defend the client in court, if the claim came in.
Early reporting of the claim along with the photographic evidence helped the insurer defend the client and no pay out was made on a potential £15000 claim.
Employers’ Liability £10,000,000
This policy provides cover to meet your statutory obligation as an employer to protect your business against Liability for cost and damages that you may be legally required to pay as a result of injury or disease affecting an employee.
What if I only use a sub contractor occasionally, or a family member helps me out periodically, do I need full Employers Liability?
– If you use a sub-contractor you should check that they have their own insurance and that it is valid.
– Public liability policies will extend cover to include part time employees but you need to pay the relevant premium. Employers’ liability is a legal requirement so you should ensure that everyone, even if it is only for one day, is covered.
Are there any excess sums in a claim?
– Employers’ Liability policies should not include an excess. I say should, because there are offshore insurers that have put excess’ on EL.
Products Liability £1,000,000 -10,000,000
This insurance protects against your legal liability for accidental bodily injury to members of the public, or accidental damage to material property caused by any product supplied. A separate policy should be obtained should you require Product Recall insurance.
Is this about product that we buy in from a merchant and supply as part of a job?Who is liable if something did go wrong?
This cover is generally designed for people that manufacture their own products and as a rule painters will only require public liability.
Some insurers will include Products Liability as part of the Public Liability policy as they understand there is a slight grey area when it comes to products purchased and supplied (premiums from these insurers usually 20-30% higher). Excess’ are £250.
Material Damage or office insurance
This section may include the buildings themselves and items taken out, or in transit. This policy is recommended as it meets your requirement for cover up to the sums insured requested.
Buildings (inc Subsidence)
Stock Work in Progress
Stock in the open
Non Ferrous Metals
Goods in Transit (per vehicle)
Machinery & Plant
Portable Hand Tools
All Risks (away from the premises)
What are the insured sums for these items?
There is no set limits for these policies as they depend on what the client has. Excess’ are set at £250 although this increases to £1000 for subsidence.
Business Interruption (maximum 12-36 months loss period)
This policy is an extension of office insurance and covers loss of profits as a result of total or partial inability to trade following an insured claim.
Does that mean you have no cover until 12 months have elapsed, and then you can have cover up to 3 years?
If the business interruption cover is taken out as part of the office insurance then the client is able to claim for loss of earnings/profit from the moment they make the claim. The interruption period depends on the type of business and how long you think you will be affected for, from the date of the loss.
You could imagine a manufacturer having a fire at their premises. If their systems cannot be copied or farmed out to other contractors then it could take 2 years to get the premises rebuilt. Saying that, it is unlikely that contractors will have much risk, as most of their work takes place away from the office. It would be more appropriate for an “increased cost of working” policy to be in place that will help the client find a new office and move them there.
How involved is the claim process, if you have your books uptodate. Is profit loss averaged out over a number of years, or how do they arrive at the loss amount?
An example of a loss of profits claim
A shop we insured discovered water coming in through the roof of the premises. As a result the shop had to shut until the leak was fixed. The owner of the building took two weeks to repair the damage and the client lost more than 6 weeks trading, due to the shop being closed.
As part of the standard contents insurance sections, the artwork, carpets and general items were replaced.
Within the first week, the insurer sent out an assessor to discuss the business interruption claim. To speed up the opening process, dehumidifiers were brought in (at the insurer’s cost) to remove the damp. The client was asked to show their earnings in previous years over the same period. The insurer also looks at the current year, to assess if the business is still trading at a similar level. This can be quite a lengthy process if you’re books aren’t up to date.
An offer was made to the client based on their loss of earnings for that period plus a little more for what they had potentially lost from future sales, as people thought the business was closed. Advertising to get people back in the store was also offered to the client.
Contractors All Risks
This cover insures work in progress for contracts you work on, up to an agreed contract value (between £50,000 and £5,000,000). Cover can be extended to include your own plant or hired-in plant whilst it is kept/stored securely on site. (excess’ for theft are usually £1000)
Hired in Plant (max Value)
Can you pay a higher premium to reduce the excess on theft?
Some insurers have a smaller £500 excess but they are very picky when it comes to who they insure. Good claims experience ect.
Professional Indemnity Insurance £50,000 to £10,000,000
This policy provides cover against losses arising from legal liabilities due to professional errors and/or omissions. Due to the growth in legal claims there are various extension and limitations to cover. I can provide a PI information sheet for a trade that is closest to painting that includes design.
Commercial Legal Expenses covers legal costs arising from claims in relation to tax Protection, VAT disputes, contract disputes, debt recovery and employment disputes.
Say the Inland Revenue write to say they are investigating you, what do you do in terms of the insurance for legal expenses? Can you use any accountant or are they specified by the insurance company?
This policy will require the use of a DAS accountant. You simply phone the 24 hour help line and they start the process from there.
Directors & Officers
This policy covers the legal liabilities of officers of the company arising from actual or alleged wrongful acts, errors or omissions, including negligent advice, misstatement or improper disclosure. This can be extended to cover Employment Practice Liability and to cover the entity of the company. Cover details attached.
We have system that enables us to quote single vans. We need to know the amount of no claims discount before we can provide a quotation and we only use Ageas Insurance
In accordance with FCA requirements, please note that all insurance information and answers to your questions are provided by Boothby Taylor.
Insurance policies and insurance advice are only available direct from Boothby Taylor.
The Traditional Painter site is purely an online platform for this FCA approved information, and the primary function is to refer readers to the Boothby Taylor site for advice.
Contact Andy at Traditional Painter for general enquiries