Cheap trades insurance: how low is too low?

When you’re running your own trades business, it’s only natural to try and keep costs to a minimum. But for tradies looking for cheap tradesmen insurance, the lowest premium often comes with compromises like high excesses, lower cover limits or restrictive terms. It’s worth asking whether you’re making a smart decision or buying into a false economy.

The cheapest cover isn’t always the best value – many UK tradespeople only discover this when they need to make a claim. We’ve heard stories of plumbers, builders, electricians and self-employed contractors taking out low-cost cover, only to face high excesses, unexpected restrictions or soaring prices after making a claim.

If you’re comparing policies, this guide breaks down what makes trades insurance cheap, how cheap cover differs from good-value cover and how to compare quotes properly.

So how low is too low?

*Disclaimer – this is a general guide to tradesmen insurance. Always read your policy wording or check with your insurer for more accurate details.

What can make a trades insurance policy so cheap?

Like with anything you buy, a lower price normally comes with compromises – and the same can apply to trades insurance. The reality is, cheaper premiums are often only possible because adjustments have been made elsewhere, like…

High excesses

One of the most common ‘traps’ is tradesmen insurance with high excesses. And the normal trend is the lower your trades insurance premium, the higher your excess might be.

It’s also not unheard of for excesses to skyrocket after a claim. The lesson? The true cost of your trades insurance isn’t just your premium payments, it’s what you’re expected to contribute if something goes wrong.

Lower cover limits

Another reason some insurance is cheaper is because they offer lower levels of business protection.

When shopping around, you’ll normally find limits like:

• Public liability insurance ranging from £1 million to £10 million
• Employers’ liability insurance ranging from £5 million to £10 million
• Professional indemnity insurance ranging from £100k to £3 million

So for example, one trades insurance package may include £1 million of public liability insurance while another may offer £5 million public liability insurance.

While they both offer public liability, they each provide very different levels of cover. And if your insurance cover limits can’t match the value of a claim you need to make, you could be left with big bills to pay.

High-risk restrictions

You may also find that cheaper policies come with more cover limitations. It normally impacts higher risk trades the most, with many insurance providers applying restrictions to businesses that:

• Work at height
• Work with heat (hot works)
• Conduct certain specialist trade activities
• Work outside the UK
• Work with specific materials

It’s best to understand what could make your trade high-risk and check your policy wording for any conditions that might leave you without cover and unable to make a claim.

Less business requirements

Things like the size of your business, how many employees you have and the type of equipment you need to insure can all impact the price.

It comes down to the full extent of the risks you need your insurance to cover – the less you need to cover, the lower your premium could be.

It’s generally assumed that smaller businesses can get lower premiums, but it really depends on other factors like their activities, equipment and turnover.

For example, a sole trader in a high-risk profession and lots of equipment to insure wouldn’t be guaranteed a cheaper quote than an SME trades company with 3 employees and minimal equipment to protect.

Smaller package

Trades insurance is normally presented as a package of policies relevant to tradesmen and, chances are, the lower the price the less coverage is included.

You might find a great price and think ‘job done’ but only end up insured for £1 million public liability and maybe £1k tools insurance. Things like professional negligence and damage to plant equipment might not be covered unless you’ve specifically taken out extra cover for those risks.

If you need additional policies like employers’ liability or plant insurance, your premium will naturally increase. The good news is some package policies will bundle cover with optional add-ons so you can get comprehensive cover without paying for extra things you don’t need.

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Cheap insurance vs good-value insurance

Day-to-day, the terms “cheap” and “good value” can be used interchangeably. But it’s important to remember that they’re not always the same.

Cheap insurance:

• A lower initial premium
• Potentially higher excesses
• Few sections of cover
• Lower cover limits
• Extra conditions or exclusions

Good-value insurance:

• Competitive price
• More comprehensive cover sections
• Wide cover limit ranges
• More affordable excesses
• Better long-term protection

What you should look for when comparing tradesmen insurance quotes

When comparing trades insurance, remember that while the cheapest cover might be the best for your wallet today, the one that’s actually best for your business could be the one that provides the right balance between affordability and protection.

What you need can vary depending on your business size and location, but keep an eye out for a few factors like:

• The right cover – Confirm that you get the core cover you need, which could include public liability insurance, professional indemnity or employers’ liability.
• Excess amounts – Check what you’ll need to contribute if you have to make a claim.
• Cover limits – Make sure your policy’s cover limits are enough for the type and size of work you carry out.
• Tool insurance – Can your insurance cover the bill if you need to replace stolen tools? Can it protect against tools stolen from your locked vehicle?
• Exclusions – Read your policy wording and be sure that there aren’t any restrictions that directly exclude circumstances you specifically need to cover.
• Additional covers – Are you protected in all the ways you need to be? Having to take out separate insurance for extra risks like plant equipment damage or tool theft could cost more in the long run.

While comparison sites can be useful, it’s also wise to know how to properly compare insurance quotes, and not just rely on headline prices.

Can cheap trades insurance cover options still be worth it?

Absolutely. Not every affordable insurance policy is poor quality, and not every expensive policy offers superior cover. The important thing is understanding exactly what you’re buying for the money.

As a tradesperson, you know quality matters. You take pride in your work and wouldn’t want to settle for using cheap materials and cutting corners that just create bigger problems.

Apply that logic to your business insurance. Instead of asking “what’s the cheapest?“, ask “what’s the best value?“.

The best tradesmen insurance combines competitive pricing with appropriate cover levels, reasonable excesses and clear terms.

Flexible cover for your trade

At Kingsbridge, we know every trade needs its own combination of cover. That’s why we offer a flexible Tradesmen Insurance policy designed for your trade so you’re only paying for the cover you need and nothing you don’t need.

It bundles core covers like Public Liability Insurance, Goods & Tools cover and Employers’ Liability (where legally required) and can be modified with optional add-on covers including plant equipment cover, Contract Works and Professional Indemnity Insurance.

Plus, it offers perks like:

• Up to £2,500 Goods & Tools cover included as standard
• Cover for tools stolen from a secured van overnight (where there are signs of forced entry and security conditions are met)
• Nil or low excess available for most trades
• Real support from in-house dedicated experts
• No hidden fees

Get in touch to speak to our team of experts and get a quote today. They can talk you through your options and help you find the best cover to protect your business – they’re only a phone call away on 01242 312 604.

Cheap trades insurance FAQs

What is the cheapest type of tradesmen insurance?

Public liability insurance is often one of the most affordable forms of trades insurance. However, the cheapest option depends on your trade, level of cover, claims history, business activities. The size and location of your business can also affect your premium, meaning a sole trader may pay less than a larger trade business with more employees in a higher-risk area.

What does excess mean?

Excess is the amount you agree to pay towards the cost of an insurance claim before your insurer will pay out the remaining amount.

For example, if the claim is for £3,000 and your policy has a £250 excess, you would pay the first £250 and your insurer would pay the remaining £2,750.

Can cheap trades cover protect against tool theft?

Not always. Some low-price options exclude tools cover or offer only limited protection. It’s important to check whether tool theft, accidental damage, loss or tools in your vehicle are covered. Coverage for tools stolen from a van overnight will also depend on where the vehicle is parked, like on a drive, and if security conditions were met.

Can self-employed tradesmen get affordable insurance?

Yes. Many insurers offer affordable tradesman insurance for small businesses, sole traders and contractors. The key is finding cover that balances cost with the protection your business needs, while still being appropriate for your trade.

What does good tradesmen insurance include?

The definition of “good” insurance will differ from trades business to trades business. It comes down to what your business will benefit from most. Many tradesmen benefit from public liability insurance, tools insurance and professional indemnity. Employers’ liability insurance is also a legal requirement in the UK for companies that employ anyone, covering against injury claims from employees, although some employers’ liability exemptions may apply.

You might also want the option to add protection for plant equipment or projects in progress (contract works), so for you a ‘good’ package would need to offer the flexibility of optional add-ons.

Which company gives the cheapest tradesman insurance?

There isn’t one insurer that’s consistently the cheapest for every tradesperson. Insurance providers calculate premiums differently, so the most competitive quote for a plumber may not be the cheapest for an electrician.

Factors like the type of work you do, your business size and claims history can all influence the price. Comparing quotes from multiple insurers is usually the best way to find the lowest price for your business.

Which trades pay the least for insurance?

While lower-risk trades may be more likely to find a lower insurance quote than a high-risk trade, there’s no one trade that will pay the least for their insurance. Your premium will also be affected by circumstances like your business size, turnover and equipment value.

Do tradesmen need professional indemnity insurance?

Professional Indemnity insurance is worth considering if you provide advice, designs, plans, specifications or measurements as part of your work. It can help cover claims that a client has suffered a financial loss because of an error, omission or negligent advice. Find out more in our guide to professional indemnity insurance for tradesmen.

How do clients check a tradesman is insured?

Clients can ask to see proof of insurance, like your policy schedule, to confirm what type of insurance you hold. If you employ staff, you ay also be asked to share your employers’ liability insurance certificate.

How much does tradesman insurance cost?

The cost of tradesman insurance will depend on a variety of factors (covered above). Explore our guide to business insurance costs for a better idea of how insurers might calculate your premiums and what can affect your quote.