Many hands make light work and often as tradies you need the support of a subcontractor, however, if there is an injury or property damage by that subcontractor is it likely to be covered under your public liability policy?
Are subcontractors covered in my Public Liability Policy?
According to Steve Sloan from Insure 247, tradies need to be aware where there is a possible risk to the business in the event that the subcontractor does damage while working for you, your insurer may cover any claims to a third party, however, most will exclude any injury to the subcontractor. They may also increase the excess on any claim, so he explains “It is important to understand and check the endorsements on your policy or if you are unsure get your Broker to check”
Here is an example of a public liability policy extension from a leading insurer looking at subcontractors
91T Subcontractors Extension
The cover provided by the Public and Products Liability cover section of your policy is varied by the following endorsement:
We will cover;
Any subcontractor(s) but only for their liability for personal injury or property damage that is directly caused by their performance of the work for you and only to the extent that we would cover you under this cover section for your liability to that subcontractor(s) had it made a claim against you in respect of the circumstances giving rise to their liability;
However this is on the basis that:
(i) the work performed by the subcontractor(s) is part or all of the work that you
have a contract to perform for some other party; and
(ii) our liability shall not exceed the lesser of the minimum amount of liability
insurance cover required by the contract to perform the work and the Limit of
Liability shown in the schedule; and
(iii) for avoidance of doubt, it is further provided that where a subcontractor(s)
makes a claim under this clause, the Employer’s Liability Exclusion shall apply
so that we will not pay for that subcontractor(s) liability for personal injury
to any person in the service of either:
(1) you; or
(2) that subcontractor(s).
Steve Sloan urges Tradies to ask their Insurer “What would happen if?”
or Exclusions relating to Subcontractors
Check the excess on a claim when a Subcontractor is involved
Check that your subcontractor has his own cover
Check he has worker compensation or income protection insurance
If you’re still unsure contact our team on 1 300 046 787
Steve is a licensed insurance broker and marketer. He is an internet insurance pioneer in Australia.
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