Home Contractor Advice What contractor insurance is available, and what do you need?

What contractor insurance is available, and what do you need?

What contractor insurance is available?

You may be surprised at just how many insurance types are available to contractors, freelancers and small business owners in the UK. There are plenty. We’ve summarised multiple types of contractor insurance below – starting with the most common and ending with some policies you may not be familiar with.

Public Liability Insurance

One of the most common contractor insurance types is public liability insurance. This insurance protects you from any injuries you cause to other people (colleagues, members of the public, etc.) or damage caused to equipment and property that you do not own. 

Professional Indemnity Insurance

Professional indemnity insurance will protect you if you are accused of not conducting your responsibilities properly. If your client believes they are losing out on money as a result of your performance or actions, they may seek damages against you. Professional indemnity insurance will cover the legal costs associated with defending yourself and cover the amount your client may be entitled to after legal proceedings.

Employer’s Liability Insurance

Employer’s liability insurance protects employers against any claims resulting from injuries or illnesses to members of staff. If you work via an umbrella company, you will be covered by employer’s liability insurance. On the other hand, you may need to get this if you are a limited company director and employee external contractors or have an additional director. 

If you use an umbrella company, public liability, professional indemnity and employer’s liability insurance is usually included at no additional cost.

Personal Accident Insurance

While it may not apply to all, personal accident cover may be invaluable to contractors who could potentially get injured on the job. As the name suggestions, personal accident insurance is there to protect you if you’re unable to work due to an injury or sickness. If you’re unfortunately and need to claim personal accident cover, you’ll probably be entitled to a weekly pay-out until you return to work or a lump sum if you can’t return.

IR35 insurance

IR35 is a hot topic in the contracting world – especially with off-payroll changes in the public (2017) and private sector (2021). If a contractor is wrongly deemed as outside IR35 (by their end-client, or by themselves), IR35 insurance may come in handy. Providers offering IR35 insurance are often the same providers who offer IR35 status assessments too. As a result, providing their in-house tests agree that you’re outside IR35, their insurance should cover you if HMRC think otherwise. Always look at the small print and make sure you know exactly what the IR35 insurance package covers.

Directors’ and Officers’ Liability Insurance

Limited company directors may be interested in Directors’ and officers’ liability insurance (D&O insurance). D&O covers you against the costs of claims made against directors of your limited company, as well as officers. End-clients could make potential claims if you mislead them, cause errors, show negligence, or breach your responsibilities and trust.

Life insurance

Thinking about life insurance isn’t particularly pleasant, but it’s something we should all consider. Whether you’re an employee or self-employed, life cover could help cover the costs caused by your passing (such as funeral costs), and some policies will present your loved ones with a significant lump sum. Life insurance policies vary tremendously, so it’s worth contacting a specialist insurer and letting them know what you’re after.


There are plenty of contractor insurance options, and if we have only included the most common. If you’re looking for contractor insurance that isn’t on the list above, check out the offerings of some of the most well-known contractor insurance providers in the UK, including Kingsbridge and Hiscox.

You must read insurance policies carefully before committing to purchase – because providers are likely to have differentiating terms and conditions. Always choose a reputable firm. 

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